On today’s show… oil prices could double by the end of the year, Toyota dominates the Daytona 500 and VW could be forced to build an EV charging system for the United States. All that and more coming right up on Autoline Daily.
This is Autoline Daily for February 22nd, 2016.
OIL PRICES TO DOUBLE
Motorists the world over are enjoying lower oil prices. Almost no one expected oil to fall below $30 a barrel. Well, enjoy it while it lasts. A report from the investment firm Raymond James predicts oil will hit $69 a barrel by the fourth quarter of this year, and will rise to $79 a barrel in Q4 of next year. Raymond James says that current prices are too low for any non-Opec producer to earn decent returns and that prices will have to rise for them to keep producing.
TOYOTA SWEEPS DAYTONA 500
Toyota dominated the Daytona 500 yesterday. Not only did it win the race, it took the top three spots and four of the top five. It’s the first time Toyota won the most important race in NASCAR. The Japanese automaker entered NASCAR to build up its brand image as being part of American culture. And it’s undoubtedly working. There is a new generation of race fans that have grown up with Toyota being at every race. For them, it’s not a newcomer. By the way, the finish of the race was the closest ever, with Denny Hamlin edging out Martin Truex by only one-one hundredth of a second. It was literally a photo finish.
Still to come… Honda recalls the Civic due to engine problems, and Ford and Volvo beef up their infotainment options.
HONDA’S PISTON RING PROBLEMS
Uh oh! Honda is running into some issues with its North American Car of The Year. The Japanese automaker issued a stop-sale on some 2016 Civic models due to missing or mis-set piston rings, which could cause engines to stall or fail altogether. Honda has not said how many vehicles are involved, but some reports say that 34,000 Civic models will need to be fixed. And as of right now it sounds like replacement parts aren’t available and won’t be until mid-March. Honda is also waiting to issue an official recall until NHTSA has acknowledge its recall plan.
FORD N’SYNC WITH EUROPE
Connected cars are all the rage these days and so now Ford is expanding its infotainment and mobility services to its European customers. Starting later this year, Ford will offer the new SYNC 3 communications and entertainment system as well as its customer experience platform, called FordPass. Ford says it is transitioning to become both an automaker and a mobility company.
VOLVO TEAMS WITH SPOTIFY
And in related news, Volvo will launch a brand new Spotify app for the infotainment system in the new XC90, S90 and V90. The music streaming service can already be used in Volvo cars via Bluetooth, but the unique and custom-made interface will not require a smartphone and adds a search function as well. Those new to the service will get a 30-day free trial, but from there the Volvo Spotify app will require a Premium subscription. Spotify is a Swedish company so it should come as no surprise that Volvo is the first automaker to integrate the service into its cars.
Coming up next, VW could be forced to build an EV charging system for America.
VW FACES “CLAW BACK”
Volkswagen’s punishment for its diesel emission cheating scandal is going to go above and beyond paying fines, fixing the engines and reimbursing owners. Bloomberg reports that the company may be forced to fix the environmental damage it caused in the U.S. Last year the EPA decided to allow companies to “carve out” part of a fine to pay for programs that benefit the public. That means corporations must commit to spending part of their fines on remedies that will fix the problem. In VW’s case, the claw back could include paying to build an infrastructure to charge electric cars, or cleaning up five times the amount of pollution created by its cheating diesels.
Be sure to join us for Autoline After Hours this Thursday when our guest will be Dan Nicholson, the head of all powertrain development at General Motors. Or maybe we should say the head of all propulsion at GM. That’s because GM just changed the name of the group from Powertrain to Propulsion. We’ll get to the bottom of what that’s all about, so join John and Gary for some of the best insights we get from some of the top executives in the automotive industry.
And that wraps up today’s report, thanks for watching and please join us again tomorrow.
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Comments (37)
February 22nd, 2016 at 11:40 am
So why can’t VW just buy pollution credits (like some of the other ‘makers’ do); even though their cheating in onerous, dare I say despicable, other than being blatant, buying credits is virtually the same as the other polluters do. Or should we use the politically correct term: “emissions trading”; that’s makes it all better…………….right?
February 22nd, 2016 at 11:45 am
Whoever signed off on VW’s blatantly breaking the law, should receive criminal charges. I don’t expect Herr Winterkorn to go to prison any time soon, though.
February 22nd, 2016 at 11:54 am
Recalls or stop sales mystify me. Chevy forgets to tighten the rear suspension tie rods on Corvettes. Jeep has screws pierce the wiring under the headliners of Grand Cherkees, and now Honda may have forgotten to put piston rings in their Civic’s engines. Makes me wonder how in the 21st century these checks and balances get missed.
Also on the subject of EVs and VW being coerced into building charging stations, does anyone have any experience buying a recharge from charging stations? Is a 60 mile charge only about $5, comparable to a 30mpg ICE?
February 22nd, 2016 at 12:02 pm
#3 Lisk Production facilities have control plans and FMEA’s attempting to identify all potential failures. Most times failures occur when the control plan isn’t followed. A number of reasons can cause an assembly line to not follow their process. In any case the Honda pistons are likely a supplier that may ship the pistons in to Honda with the rings already installed (or not). Which just means someone else didn’t follow their process.
February 22nd, 2016 at 12:09 pm
Seems like running a “gas station” could be an expensive capital investment with three tanks of low,mid and high octane fuel. Diesel tank, E85, E100, Hydrogen, CNG, and electric charging stations. I’m sure there are more.
February 22nd, 2016 at 12:10 pm
@3. It is a trick question to answer. Contributing causes are line designers who have never built anything on a production line at all. Work instruction, if updated, are not accurate or detailed enough to advise any new work, (and some existing) as to how to do a stations job. More auto manufacturing (OEM & parts) are doing so with a contingent or temporary work force. These folks are brought in on a promise of full time work and benefits only to have to work for months on end at sub par pay and a carrot dangle. It is a moral killer. There are a number of top tier suppliers that have not increased pay for production in over 10 years. Also a moral killer when production sees sales go through the rood and profits soar only to be “sorry no pay increase this because…insert excuse here.”
February 22nd, 2016 at 12:24 pm
#6 Thats one of the reasons profit sharing makes sense. When a company gives 8000 workers a raise when sales and profits are up they are still paying that when things fall flat in a few years which the auto industry does. Thats explains their reluctance to give big raises because everyone knows its temporary. But. with profit sharing when the company does well the employees benefit too.
February 22nd, 2016 at 12:33 pm
Most modern engine assembly are “kitted” to assure parts are not omitted, so as Rob (#4) suggests, the pistons assembly likely came from an outside supplier who (supposedly) assembles the rings on the piston, ready to drop in. I suspect the number of engines with missing/mis-assembled rings is very small, but Honda could not narrow down the span of time the problem existed, so they have to recall 34,000 vehicles that potentially could have the problem. Hopefully the problem can be detected with a cylinder leakdown test or audible test (piston slap). I would not want to own a “new” vehicle in which the service department had to pull the pistons out to see if things are okay. I guess Honda could also extend the warranty on the suspected engines and just let the consumer “find” the bad ones.
February 22nd, 2016 at 12:37 pm
SEAN the stop shipment on Honda civics is not for piston rings but the retaining C-clip for the piston pin.
February 22nd, 2016 at 12:51 pm
As Rob said, after looking at the Honda engine recall, the problem is missing or unseated wrist pin snapring. It appears the way Honda is going to inspect the problem is with a borescope, so I assume they will be looking for evidence of the pin or snapring sliding out and scoring the cylinder wall. This does not seem to be a fool-proof way to find all of the bad engines, only the ones where the damage showed up early. An improperly set snapring could hold for years, then pop out after warranty.
February 22nd, 2016 at 1:00 pm
When will Honda partner with another OEM and enter Nascar? I know that GM and Honda are currently partnering on Fuel Cell Technology, but what about small displacement engines?
I will not buy a vehicles will a engine smaller than 2.5 liters in displacement. I would love to see a CR-V 2.5 Liter Earth Dreams power plant in the next generation Chevy Equinox or GMC Terrain. I foresee these two vehicles being down sized to the portions of the New Buick Envision. I remember then GM purchased V6 engines from Honda for the Saturn Vue after the Opel derived 3.0 Liter in The Saturn Vue had horrible reliability and poor gas mileage.
I keep my vehicles for longer than average periods of time and do not want problems from one of these smaller under powered engines loaded up with turbos to get them moving out of my garage. Call me old fashion but I enjoy driving and am not looking forward to iRobots driving all around me.
February 22nd, 2016 at 1:01 pm
I found out about the Civic stop sale about two weeks ago (and about a week after I got mine). It covers only models with the 2.0 liter engine (LX & EX) and not the 1.5L turbo models. Specifically, it is the piston pin snap ring that is either not installed properly or not installed at all. I, none too happily, called Honda and the dealership where I got mine and was assured my VIN did not make the list. Of course, and as expected, there is no assurance it will not make a future list. I politely and professionally advised both that a new car with a rebuilt engine would be absolutely unacceptable. Such are the risks and realities of a new model.
February 22nd, 2016 at 1:07 pm
I thought all the cars running in NASCAR are the same nowadays, why get worked up when brand “A” beats brand “B”. Is there more than 1 brand of tires ? Just like them all using the same Gasoline.
February 22nd, 2016 at 1:09 pm
Once again, an unelected US agency sets itself up to go beyond precidence to inflict their brand of punishment for the greater “good”. When the EPA or NHTSA couldn’t get an EV infrastructure built willingly they latched onto this draconian measure. What next will they make VW do, give everyone free replacement batteries at way stations? Why not? Or how about having VW subsidize all EV purchases and not the govt?
February 22nd, 2016 at 1:15 pm
I think it would be a good thing for VW to be forced to build an electric car powering station infrastructure in the US. This would leap frog them over all other OEMs working on electrified vehicles. VW could partner with Tesla, Nissan, GM and Ford because we all know that the electric vehicle is hear to stay this time and these very low oil prices are not permanent. The only OEM not concerned with Electric Vehicles is FCA. FCA will fall apart and fail once Sergio Marchionnie retires.
February 22nd, 2016 at 2:07 pm
12 Jon, I’d think you should be “safe” from the missing wrist pin thing, since your engine would share almost nothing with the 2.0. Like you, though, I would not be happy if told that the engine in my new car needed to be “rebuilt,” and maybe over-bored to fix the scratched cylinder walls. I’d want a new car.
Anyway, good luck with your car. Hopefully, it won’t show up on a future list.
February 22nd, 2016 at 2:13 pm
This Honda thing reminds of a college friend’s Datsun 240Z many years ago. The engine apparently had wrist pins pressed into the con rods or pistons, with no retaining clips. Apparently the press fit was not tight enough, because he had major problems within a few thousand miles. They installed a new “short block.” It was still running ok when we went our separate ways, so apparently the new engine was ok.
February 22nd, 2016 at 2:19 pm
@ 14,Tuck&Roll: VW can delay this long enough for us to get a real president.Then I believe the feds will be reeled in.But…..we shall see.
February 22nd, 2016 at 2:21 pm
When GM dominates a NASCAR race, I don’t remember seeing headline saying GM dominates. Why is the media likes to put foreign cars on a pedestal all the time? Are we anti-American?
February 22nd, 2016 at 2:25 pm
OPEC has agreed to cut production to artificially create a shortage and force up the prices as this is what they did in the 1970s and caused the gas crisis; this is why Obama shouldn’t be pushing for a $10 per barrel tax because it would artificially cause US oil to be even higher. The big question is how long will Saudi Arabia keep production down because they need oil revenue to continue buying weapons and attempting to fight ISIS.
February 22nd, 2016 at 2:29 pm
Saudi had better pray our Yankee ingenuity doesn’t figure out how to make fracking cheaper, necessity being the mother of invention.
February 22nd, 2016 at 2:48 pm
#19 I think its news only because its the first time Toyota has won Daytona and won with such a strong group in the top 5 it is noteworthy. GM and Ford are like the last few space shuttle flights. Was exciting at first but after 20 launches it was old news. So not anti-American IMO.
February 22nd, 2016 at 2:57 pm
22 I’m only happy when Kyle wins
February 22nd, 2016 at 4:38 pm
Re: the Civic engine issues, I guess the old idea of not buying an all new car its first year is not that dumb or useless after all, eh?
February 22nd, 2016 at 4:44 pm
13 – While the Sprint Cup cars share most components in common, the brands (Chevy, Ford, and Toyota) are differentiated by front sheet metal that somewhat resemble their stock version (more than just paint, unlike the Gen 5 cars). However, the main difference are the V-8 engines which must be based upon a production engine from the manufacturer. If one of the brands gets overly competitive, I believe NASCAR will tweak the rules for more parity.
February 22nd, 2016 at 4:54 pm
#18 –ALL presidents are real , & typical of the breed.
February 22nd, 2016 at 4:58 pm
23 It seems that a bigger has been made of a Toyota winning Daytona, than of Kyle winning the championship in a Toyota.
February 22nd, 2016 at 5:08 pm
As if they use autonomous cars in racing!
February 22nd, 2016 at 5:09 pm
I’m embarrassed to say it, but I take more notice of the m&ms sponsor than of Toyota’s engine.
February 22nd, 2016 at 5:59 pm
I haven’t watched ASCAR since they used bodies based on real production cars, the way the rules are written now it isn’t anything more than a spec series and the “Stock Car” part is the biggest joke in racing. Hard to get excited about decals and front fasciae differences.
February 22nd, 2016 at 9:53 pm
25 What Toyota production vehicle uses a cam-in-block pushrod V-8? Do they use one somewhere other than the U.S.? I’m pretty sure the Toyota V8′s in Tundra, LS, Sequoia, etc. are 4 cam engines.
February 22nd, 2016 at 9:56 pm
29 The M&M’s car is nice and colorful. Toyota should sell a special edition Camry with that paint job.
February 23rd, 2016 at 4:34 am
#15 – If it had been EPA/CARB, those would be hydrogen stations. An unattributed source, it sounds fishy.
The VW ‘instigator’ is proposing what would support sales of their EV MicroBus. It also feeds the VW sponsored rumors that it is not emissions but a ‘trade-war.’ If you agree, thank the President for bringing more jobs to the USA . . . but I suspect it is a VW false-flag.
In a perfect world, VW would buy back the cheat-diesels by offering a new-for-used swap of a legal car. To move it along, have the offer depreciate over time. So if a diesel fan prefers to keep their already ‘scrap value’ car, let ‘em. But emissions testing states could add a NOx test and add a ‘stick’ to get them off the road.
With new-for-used buy-back, everyone wins. Owners get ‘a free ride’ for the cheat-diesel years. VW gets to manufacture replacement, new cars. Finally, VW gets 480,000 used cars to remanufacture, or salvage. Say store them in a dry place and setup a remanufacturing or salvage operation.
Bob Wilson
February 23rd, 2016 at 8:54 am
#33 I think people are getting hung up on this proposal for VW to set up EV stations. I don’t believe the EPA over-stepping any reach. I see it no different than a judge giving a person the option to spend 30 days in jail or go do community service. They are offering VW a chance to pay a lesser amount in fines if they install EV stations and would be an option not forced.
As for recycling the diesels, I don’t believe any manufacturer would take on that liability. Gathering up used vehicles replacing motors and trying to sell them as remanufactured cars would be an expensive endeavor, not to mention filled with risk. Just as mentioned with the Honda civic piston snap ring recall, any process that is not normal production with proper checks and fail-safe steps opens the door for failures. A third party company may be willing to take that on and just sell them as used (reconditioned engine) cars but no way would VW take on that risk.
February 23rd, 2016 at 10:15 am
I’d think it would make the most sense to sell the buy-back cars in places with no emissions regs, and where they would be used in sparsely populated areas where the high NOx wouldn’t matter.
February 23rd, 2016 at 11:40 am
#3 + others
Bottom line, we’re human. Mistakes will occasionally happen. Marks will sometimes be missed. Human error is irrevocably inevitable.
February 23rd, 2016 at 11:43 am
It’s just that some are more prone to it than others. cough-cough…Chrysler Ehh-ehhmm…Range Rover