Let them fail!

[a_majoor]

Make sure you check your mutual funds and investments to ensure you are not exposed to GM:

http://dailycaller.com/2011/08/05/will-obama-dump-his-gm-stock-at-this-price/

Psst. Despite recent reported profits, GM stock is trading at around $26–below its IPO price of $33 and about half what it would take for the government to break even on its investment. Is the Obama administration really going to dump its GM stake at such an embarrassingly low price? Wouldn’t that provoke a lot of stories, not about how the government is finally out of GM’s hair as promised but about how poorly the bailed-out company is doing? … P.S.: Yes, the entire market is down. But GM has done worse than the overall market, trailing the major stock indexes by a significant margin. …

Read more: http://dailycaller.com/2011/08/05/will-obama-dump-his-gm-stock-at-this-price/#ixzz1UJJZ8GsY

 

[a_majoor]

Since GM has been taken over by the US government and now exists to satisfy various political agendas, there should be no surprise that they produce vehicles that are not competative and are still bleeding money. A total shakeup is needed, perhaps in 2013 the new Administration will admit defeat and simply sell its shares in the market at a loss and allow the company to really reorganize through a Chapter 11.

http://www.investors.com/NewsAndAnalysis/Article.aspx?id=581078&p=1

General Motors Needs A Shake-Up

By KEN BLACKWELL Posted 08/10/2011 06:52 PM ET

The way to run an automobile company is by putting people who understand and love cars in charge. The bean counters, lawyers and political insiders have their place, but when they take over, there's sure to be trouble down the road.

They're going to care more about Wall Street and Washington than Main Street, and the poster child for it all is General Motors.

Back when Ed Cole became president of GM, it was because of his success in designing and building some of the most successful and beloved automobiles of all time — the Chevrolets of the late 1950s.

Just ask any classic car enthusiast.  If you don't know one, ask your grandfather. If he's 70 or so, he either had one or wanted one.

Sometime between then and now, the car guys stopped getting the top jobs at GM, to be replaced by bean counters — people who supposedly put company finances first, but who never really understood the relationship between the product line and the bottom line, or the arts and sciences necessary to know or craft what the consumer really wanted.

As the overall influence of the engineers and designers declined, so did the company.  Wages, pensions and benefits skyrocketed out of control, ever-increasing government regulation took its toll, and most importantly, the product line had less and less appeal to the car-buying public.  Increasingly, people turned to other manufacturers.

Eventually, the worst-case scenario came to pass, and Washington took over. The pols just don't get it, the evidence for which is the man they put in charge — Dan Akerson, who came to the job with no experience in the car business, but the perfect resume from the viewpoint of the pols and bean counters.

How so?  He had a Wall Street type job in charge of leveraged buyouts for a private equity company, but he was based in Washington.

Predictably, none of GM's old problems have been solved, and the product line has moved even farther from the goal of customer appeal. What matters to the folks in charge today is ideology.

In his new book, former GM Vice Chairman Bob Lutz recounts how prominent Democrats were adamant that "if they get our money, they're going to produce the kind of vehicles we want them to produce."

The result is the Volt, a car only left-wing politicians could love — and even they apparently aren't buying it. GM is still selling only a few hundred of the battery-driven Volts a month, less than a third the sales of Nissan's all-electric Leaf.

 

[a_majoor]

As if we need more confirmation; this alone will make great political hay in the next election:

http://biggovernment.com/smotley/2011/08/22/general-motors-again-ripping-off-americans-warranties-edition/

General Motors Again Ripping Off Americans: Warranties Editionby Seton Motley/b]
The transformation of General Motors (GM) to Government Motors (GM) has cost a lot of Americans a lot of money.

Many, many of them under questionable and in fact illegal circumstances.

Let us begin with the $50 billion ‘We the People’ were forced to “invest” in General Motors – including a $30 billion Barack Obama bump so as to give his Administration greater sway in how things would subsequently go down.

We were originally told – by Obama himself – that we would make money on the bailout.  Now we’re told we’ll lose somewhere between $11 and $14 billion (and given the stock price’s long, slow slide, maybe even more).

And about which we were lied to by the Administration.  Which said this titanic loss of coin is less than they were expecting – just seven months after Obama his own self said we’d turn a profit.

Then there was the 2009 GM bankruptcy filing (which we were told our $50 billion would forestall – oops).

Through which the Obama Administration’s new toy car company eviscerated existing law to benefit their union, campaign-funding cronies at the illegal expense of GM bond holders – who should have by law received preferred treatment.

The ripped off didn’t take too kindly to being the Administration’s latest dupes:

We believe the offer to be a blatant disregard of fairness for the bondholders who have funded this company and amounts to using taxpayer money to show political favoritism of one creditor over another….

No kidding.


“What they’ve offered us is ridiculous,” said Chris Crowe, 50, a Denver, Colorado-based home inspector at an event organized for small bondholders in this Detroit suburb. “I know there are only so many pieces of pie, but they’re giving us crumbs.”…


(S)aid retiree (and GM bond holder) Dennis Buchholtz,… “We have invested twice as much as the government and we’ll only get a fifth of what the government will.“

Well that seems fair.

“I’m equally as mad at GM as at the government because GM has done nothing more than give the UAW (United Auto Workers union) and the government what they want,” said retiree (and GM bond holder) John Milne….

Government Motors giving the government and their union campaign suppliers what they want, and ripping off the rest of us.  Shocker.

Now we get word that Government Motors is gearing up to rip off GM warranty holders.  Specifically (at least for now) those holding on the 2007 and 2008 Chevy Impala.

Let us flashback to GM Bailout Time: Obama his own self promised Americans that were GM unable to make good on their warranties, the government would.

From one of his famous problem-solving speeches:

“Let me say this as plainly as I can. If you buy a car from Chrysler or General Motors, you will be able to get your car serviced and repaired just like always.


Your warranty will be safe. In fact, it will be safer than it has ever been. Because starting today, the United States will stand behind your warranty.”

When Obama asserts plainness or clarity – prepare for the worst kind of obfuscation.

GM is now trying to claim that their bankruptcy – which they used to illegally rip of  bondholders – also allows them to rip off those who are seeking to have their GM cars repaired as per their written guarantees.

(I)n a recent filing with the U.S. District Court in Detroit, GM noted that the cars were made by its predecessor General Motors Corp, now called Motors Liquidation Co or “Old GM,” before its 2009 bankruptcy and federal bailout.

The current company, called “New GM,” said it did not assume responsibility under the reorganization to fix the Impala problem, but only to make repairs “subject to conditions and limitations” in express written warranties. In essence, the automaker said, Trusky sued the wrong entity.

“New GM’s warranty obligations for vehicles sold by Old GM are limited to the express terms and conditions in the Old GM written warranties on a going-forward basis,” wrote Benjamin Jeffers, a lawyer for GM. “New GM did not assume responsibility for Old GM’s design choices, conduct, or alleged breaches of liability under the warranty.“

So all Obama has to do is change his name, and he’s not responsible for the terrible economy he’s fostered?  Same guy, same failed policies, different name – so vote for him again in 2012.

Is this a set-up?  Is GM looking to duck their responsibility – so as to foist the bill upon We the People, as per Obama’s “plain” promise?

Or is there something even worse occurring?

Wasn’t GM “too big to fail” – meaning (we were told) we had to bail them out to make sure they kept their promises to the American people?

Not just to their employees, but to all those parts manufacturers and car dealers – everyone who was so intertwined with the auto monolith that they too would go down were GM to do so?

And weren’t we told over and over again that we needed to bailout GM because we had to make good on their contracts with the auto unions – you know, the ones that were illegally over-rewarded in the bankruptcy?

In fact, hasn’t that been a primary defense of the back-breaking status quo in government budget fights all over the country – Wisconsin, Ohio, Illinois and elsewhere?

That these governments have signed sacrosanct contracts with their public sector union cronies – and they must be maintained and adhered to, no matter how insolvent it leaves their states?

Well, these GM car owners have contracts too.  But these are “plainly” deemed less sacrosanct.

Because these folks made the same fatal mistake as did GM bondholders (and select GM car dealers) – they didn’t contribute huge coin and political field work to Democrats.

Which of course the unions always do.

So on Obama’s Animal Farm, all contracts are equal, but some are more equal than others.

Thusly is the newest round of Government Motors rip offs set to commence.

 

[a_majoor]

Nice to know where all your money (and yes, GM and Chrysler got a huge chunk of Candian taxpayer cash as well) is going:

http://dailycaller.com/2011/09/19/why-not-pay-back-taxpayers-first/

How about paying back the $15 billion first? I’m sure there are sophisticated arguments for why the UAW members shouldn’t pay back the taxpayers who bailed their employer out of bankruptcy before they negotiate a deal that gives them each a $5,000 bonus. I just can’t think of them right now. … Just from a PR standpoint, repaying the debt would seem like a good idea. …

Sure, as a going concern, GM has to pay to keep its employees from bolting to a competitor. But what are the odds that most of GM’s UAW workers (i.e, the ones not in the $14-an-hour Tier Two) could find jobs anywhere near as good as the ones they now hold? Almost all their leverage comes from the Wagner Act’s power to strike and not be fired. Without Wagner, they’d be free to quit, which they would not do. (Go ahead. Make GM’s day.) 

It’s one thing to give workers power to negotiate above-market wages through collective bargaining–hey, let them squeeze the bosses for all the bosses can bear. It’s another thing when they squeeze more than the bosses can bear, the bosses go broke, and ordinary citizens, many poorer than UAW members, have to make up the difference.  After that, why let the UAW continue to extract Wagner Act wages as if nothing happened? …

The $15 billion aside, if GM is so profitable it can aff0rd to give its new hires a raise and all its UAW workers plush health benefits and a big bonus, that’s great. But why do I fear the economic assumptions underlying these numbers will prove to be unrealistic? Sure, GM’s doing OK now, with two of its major competitors  (Toyota and Honda) crippled by the Japanese earthquake. Those two are now coming  back online, while other GM competitors like Hyundai and VW are gaining market share. VW, at least, is explicitly pursuing a low-cost price-chiseling strategy, the better to exploit its non-union wage advantage. Plus the whole new car market may be shrinking as the economy stalls.

Maybe the UAW has taken this all into account. Or maybe they are whistling past the graveyard, Solyndra-style, hoping GM will remain profitable–or, barring that, that it will still be “too big to fail” the next time. …

Read more: http://dailycaller.com/2011/09/19/why-not-pay-back-taxpayers-first/#ixzz1YRGIq6W2

 

[Rifleman62]

General Motors Again Ripping Off Americans: Warranties Edition

The transformation of General Motors (GM) to Government Motors (GM) has cost a lot of Americans a lot of money.

I believe this. My daughter in OK is going through this now after a major failure on their truck. First it was "We don't leave our servicemen stranded" to "no warranty".

 

[a_majoor]

The UAW discovers $50 billion dosen't buy what it used to:

http://www.thetruthaboutcars.com/2011/09/carpocalypse-now-at-the-uaw/

Carpocalypse, Now At The UAW
By Bertel Schmitt on September 22, 2011

A bloated management, run-away costs, declining market share, imploding volume, a sell-off of assets and investments, headquartered in Detroit – what is it? No, it’s none of the Detroit automakers. It is their former nemesis and current co-owner, the United Auto Workers.

    “Two years after the wrenching restructuring of the U.S. auto industry and the bankruptcies that remade General Motors and Chrysler, the UAW is facing its own financial reckoning. America’s richest union has been living beyond its means and running down its savings, an analysis of its financial records shows. Unless King and other officials succeed with a turnaround plan still taking shape, the next financial crisis in Detroit may not be at one of the automakers but at the UAW itself.”

This is the beginning of a special report written by the best in the reporting business, by Deepa Seetharaman and her boss, Kevin Krolicki, Chief of the Detroit Bureau of Reuters, with the help of their team of combat reporters from the Detroit front-lines.

What they wrote may not have been known in public. The Detroit automakers are well aware of the perilous state of the UAW. In the run-up of the contract negotiations with the UAW this summer, one automaker did what one should do before going into battle: Assess the strength or weakness of the adversary. In-house economists of a Detroit company came back with a surprising piece of intelligence: The UAW is hollowed-out and heading for disaster.

    “The UAW might have three to five years before its budget difficulties forced a financial crunch, absent changes. The “hand-grenade” math of the projection gave the union less than a five-year window of opportunity to turn things around by winning new membership at foreign-run auto plants, said the person who saw the internal forecast and asked not to be named because of its sensitivity.”

In many ways, the UAW resembles the companies it opposed for so long. The UAW is America’s richest union. One of its biggest assets is its strike fund, which stood at $763 million at the end of 2010. If push comes to shove, a union is as strong as its strike fund. The trouble is: The UAW spends more than it takes in. Increasingly, the union has to dip into the strike fund, the Reuters report says. According to government filings, the UAW liquidated $222 million of investments from 2007 to 2009 to cover the shortfall between expenses and revenue.

Mirroring the U.S. auto industry, the union has seen better days. UAW membership dropped from its peak of 1.5 million in 1979 by 75 percent to under 377,000 workers. Less than a third of the membership works at the Detroit Three.

Membership fees dropped even more. Union workers still pay dues equivalent to two hours of work a month. The two-tier pay deal, negotiated in 2007, may have helped to stop an even larger membership erosion. But the membership fee is only $30 a month now.

Mirroring the U.S. auto industry, the UAW is spending heavily to get sagging volume back up. The union needs new members even more desperately that the Detroit Three need new customers. Says Reuters:

    “In 2006, UAW delegates voted to move about $110 million from the strike fund to pay for organizing. In 2010, King went back for an unprecedented double-dip in the fund and won clearance to spend up to another $160 million over four years. “

If that bet goes bust, the union squandered the bargaining power of its members. The odds are not good. “The only luck we’ve had has been bad luck,” UAW boss Bob King said last year. The UAW wants to get members at the transplants in the south. A risky gamble.  Says Reuters:

    “Volkswagen AG is paying newly hired workers at its Chattanooga, Tennessee plant $14.50 per hour. That is almost exactly what a second-tier UAW worker would make in Detroit. In a sign of demand for jobs at that pay level, the Chattanooga plant had 85,000 applications for more than 2,000 jobs. VW workers have been promised $19.50 after three years on the job. That is just above the $19.28 per hour maximum that entry-level workers at GM would make over the term of the four-year contract now before workers for ratification.”

Why pay dues if they don’t buy you more?

Gary Chaison, a labor relations professor at Clark University in Worcester, Massachusetts, figures that organizing Chattanooga could cost the UAW up to $3 million, or some $1,500 per worker. It would take the union over four years to recoup its investment – if they win.

If that bet is not successful, then at some point, someone will have to bail out the UAW – again.  No thanks, no UAW deathwatch.

 

[a_majoor]

Wow, these people don't believe they have to live with the consequences of the bailout?

Report: Ford pulls bailout ad after criticism from press, questions from White House
Published: Tuesday, September 27, 2011, 11:24 AM    Updated: Tuesday, September 27, 2011, 3:52 PM
By Jonathan Oosting | MLive.com

Still shot of "Chris" from a recent Ford "Drive One" ad pulled by the automaker.
Ford Motor Company has shelved a television commercial indirectly criticizing its competitors for accepting government bailouts to avoid bankruptcy in the wake of media criticism and, reportedly, a call from the White House.
The ad, first uploaded to YouTube months ago, was part of a series featuring real-life customers who were thrust into press conferences where actor/reporters asked them to explain their decisions to buy a Ford.
"I wasn't going to buy another car that was bailed out by our government," the customer, Chris, said in the ad. "I was going to buy from a manufacturer that's standing on their own: win, lose, or draw. That's what America is about is taking the chance to succeed and understanding when you fail that you gotta' pick yourself up and go back to work. Ford is that company for me."
The ad came under fire earlier this month when various media outlets began to point out Ford's apparent hypocricy, noting that while the automaker did not receive a government bailout, CEO Alan Mulally urged Congress to aid the industry and accepted various federal loans.
The Dearborn-based automaker is not commenting on the decision to pull the ad, but Daniel Howes of The Detroit News reports that "individuals within the White House" called Ford and questioned whether the spot criticized the policy Mulally had repeatedly supported.
An industry source said the White House did not pressure Ford to remove the ad, but Howes suggested it was pulled in response to the call, an assertion the White House again denied this afternoon.
Regardless of the motivation, Ford's decision points to the increasingly congested intersection of automobiles and politics. The industry undoubtedly benefited from government intervention, and Ford undoubtedly benefited from its ability to avoid a bailout.
It doesn't need to point that out though. The buying public does it for them.
In this case, it was Chris, who explained how he came to star in the commercial and reiterated his support for Ford during an interview this morning on WJR-AM 760.
"I still standby what I said, and that is, as Americans, we need to decide if we're going to be run by a government or if we're going to be run by free enterprise," he told host Frank Beckmann. "That's really the debate that we're facing today. So I applaud Ford, still, to this day, for having the courage to put that ad on the TV and spur the debate.

"I was interviewed for about two, two-and-a-half hours, and that was the 30 seconds Ford chose to put on there, and I'm grateful for their courage. We do operate in a world that has many moving parts, so I understand the decision, although I am a little disappointed."
Update: White House Communications Director Dan Pfieffer sent out a tweet this afternoon saying The Detroit News column suggesting the administration pressured Ford is false.

w.youtube.com/watch?v=b_mwjaEI_hM&feature=player_embedded

 

[Nemo888]

Manufacturing plants make sense. They are an essential strategic resource. Where do you think all the gear used in WWII was made? Retooled plants in Detroit baby!

Banks on the other hand,...(expletive deleted)

 

[a_majoor]

An interesting story to follow:

http://dailycaller.com/2011/11/08/project-voltwatch/

The Mystery of the Volt:

Where Will They All Go? General Motors is sticking by its prediction that it will sell 10,000 electric/hybrid Chevy Volts by the end of the year. Only 5,000 had been through October, meaning GM has to double that amount in just the final two months of the year.  Until now, Volt production seems to have been wildly outstripping actual sales.  But GM CEO Dan Akerson says sales are “starting to hit the pace,”  some reporters claim the Volt is “hot,” and the company has made a big show of allowing dealers to sell off their demo models, allegedly to supply the now-insatiable “customer demand.”  …

So where will all these Volts actually go? There seem to be three possibilities:

1) Akerson is right. The Volt is a “home run” and they’ll all soon be in the hands of satisfied customers!

2) They’ll be recorded as “sold” even though they’re sitting unwanted on dealer lots. “Sold” in GM parlance means sold to a dealer, who then may or may not succeed in reselling the car to an actual paying customer.

3) They’ll be pushed out to corporate fleets, as big businesses seek to please the Obama administration by doing their part to help bailed-out GM unload this overpriced showpiece pioneer our nations’ green future.  Call this the corporatist solution. It’s been suggested by my Daily Caller colleague Neil Munro.

To help solve the mystery, and maintain TheDC‘s traditional vigilance against corporatist advance, kausfiles is launching Project Voltwatch, in which we ask readers to report any Volts they see with business logos on the side. We will then be able to contact these companies and see how many Volts they bought. Please send your sightings to me or to Neil Munro (whose idea this was), and put “Voltwatch” in the heading. …

P.S.: Note that the Obama administration’s energy department was counting on 120,000 in Volt sales next year, even though GM has already cut production to 60,000, only 45,000 of which are to be sold in the U.S..

Read more: http://dailycaller.com/2011/11/08/project-voltwatch/#ixzz1dFxpy6XZ

 

[a_majoor]

Just in case you thought the company had any fiduciary duty to you (you know, the shareholders or bondholders....)

http://dailycaller.com/2011/11/13/the-u-a-w-s-impolitic-misprint/

Corporatism Watch: Blame the Proofreader!

Was a representative of the Obama administration “literally sitting in the room” for recent UAW/GM negotiations—as a newsletter to members of a UAW local said.  Or was the union report just a “misprint, as an official of the local now claims? … P.S.: Does it matter? The  government owns 32% of GM, after all. Why shouldn’t it watch over its investment? I suppose there are two fears: 1) The Obama administration might order GM’s managers to give the UAW a break the union otherwise wouldn’t get, or 2) The Obama administration might try to facilitate any agreement–including perhaps one that includes concessions the UAW otherwise wouldn’t give–by promising to make it up to everyone involved by steering business or favorable government rulings their way or by simply bailing them all out again.  Both sorts of favoritism can be accomplished, however, whether government officials are “in the room” or merely get second-hand reports and make a few phone calls. It’s mainly a question of “optics.” …

But given the impossibility of real transparency–i.e., proving to the public that the administration isn’t playing favorites, directly or by remote control–optics are all the Obama administration’s got. …


Read more: http://dailycaller.com/2011/11/13/the-u-a-w-s-impolitic-misprint/#ixzz1dieSM1dt

 

[a_majoor]

How bad is it really? This is only GM, no one seems to have released the figures for Chrysler yet:

http://reason.com/blog/2011/11/17/treasury-admits-what-everybody-already-k

Treasury Admits What Everybody Already Knew: Taxpayer Losses On GM Bailout Are Going to be Massive
Shikha Dalmia | November 17, 2011

Am I allowed to say, I told you so?

The Treasury Department yesterday revised its loss estimate for the Government Motors bailout from $14.33 billion to $23.6 billion, thanks to the company’s sinking stock price. GM’s Sept. 30 closing price, on which the new estimate is based, was $20.18, about $13 less than its December IPO price and $35 less than what is needed for taxpayers to break even.

The $23.6 billion represents a 25 percent loss on the feds $60 billion direct “investment” in GM. But that’s not all that taxpayers are on the hook for. As I explained previously, Uncle Sam’s special GM bankruptcy package allowed the company to write off $45 billion in previous losses going forward. This could work out to as much as $15 billion in tax savings that GM wouldn’t have had had it gone through a normal bankruptcy. Why? Because after bankruptcy, the tax liabilities of companies increase since they have no more losses to write off.

This means that the total hit to taxpayers, who still own about a quarter of the company, could add up to $38.6 billion. That’s even more that the $34 billion on the outside I had predicted in May.

Although GM will never, ever make taxpayers whole, taxpayer losses could be mitigated if GM’s stock price rises before the Treasury sells its remaining equity, something it was supposed to do by year-end but has postponed under the circumstances. But right now at least the prospects of a serious upward move in GM’s stock don’t look too good for reasons at least partly beyond GM’s control.

GM actually has been doing quite well in North America and China with profit margins of 10 percent, among the best in the industry. How long that will last is an open question. That’s because GM’s new competitors are not Toyota and Honda that share its cost structure but Hyndai and Kia that have a far leaner one. These companies concentrate on the small car market and don’t offer a full product line so GM and Ford’s most profitable vehicles—those evil, gas-guzzling, greenhouse-gas emitting SUV’s and pickup trucks—are somewhat insulated from the downward price pressure. But the greens and Obama administration want GM to reorient its product mix away from big cars and toward money-losing hybrids and electrics, something that could well put GM back in a hole.

But that’s part of the administration’s long-term strategy for ruining GM. The company’s big weak spot right now is Europe for two reasons: One, thanks to political pressure and labor resistance, it hasn’t been able to address its bloated cost structure there. Two, Europe’s economy is imploding, weakening car sales.

All of this shows why forcing taxpayers to wager their hard-earned dollars on a risky venture was exactly the wrong thing to do. But the Ostrich-in-Chief Barack Obama, who had assured taxpayers that their GM "investment" would cost them "not a dime," is drawing the opposite lesson, obviously. He has been trumpeting the success of the bailout—repeatedly. He was in Michigan recently claiming that the “investment had paid off.” What’s more, he declared, that now that GM is back, it is just a matter of time before Detroit is too:

“[D]espite all the work that lies ahead, this is a city where a great American industry is coming back to life and the industries of tomorrow are taking root, and a city where people are dreaming up ways to prove all the skeptics wrong and write the next proud chapter in the Motor City's history."

But the “next, proud chapter in Motor City’s history” actually is likely to be bankruptcy. That’s because Detroit is facing a $209 million budget deficit and is going to be completely out of operating cash by April.

Here is a very helpful piece by Detroit Free Press’ editorial page editor, Stephen Henderson, explaining in gory but accurate detail just what a mess the city is in. Perhaps President Obama can glance at it before he returns here and spins some more fairytales?

 

[a_majoor]

The future of cars, according to VW:

http://green.autoblog.com/2011/11/21/volkswagen-r-cars-future-is-diesel-awd-light-weight-trumps-hy/

Volkswagen R cars' future is diesel, AWD; light weight trumps hybrids

By Damon LavrincRSS feed

The Volkswagen R performance sub-brand isn't just a niche cog in the massive machine known as the Volkswagen Auto Group. If R GmbH's heads are to be believed, it's an instrumental component of the German automaker's push to offer something for everyone. And after speaking with the two men shepherding R into the future, it appears that good things are on the way.

With the Golf R set to go on sale in the U.S. early next year and R-branded performance parts already proliferating throughout VW's core products, Ulrich Riestenpatt gt. Richter, R's Executive Director, and Dr. Hendrik Muth, R's marketing head, are looking to the future. Fortunately, they were thoughtful enough to provide Autoblog with a small glimpse into what's on the way.

"The future is diesel and all-wheel-drive," Richter told us on the floor of last week's LA Auto Show. That could mean that the next great performance offering from VW R could come in the form of an AWD diesel hatch – essentially an oil-burning Golf R. Further, Richter contends that he can make an R version of any vehicle in the VW stable, so don't be surprised to see a Passat R in the coming years and the Beetle R getting the green light.

Just as telling, Richter says that while hybrids have their place (VW will be introducing a Jetta hybrid at the Detroit Auto Show), the fuel savings of hybrid-electric systems pale in comparison to weight reduction. "You can get the same efficiency [as a hybrid] by dropping 100 kilos," Richter admits, but the high cost of advanced composites – namely carbon fiber – is still too high. So that means more aluminum is on the way, and partnered with a high-performance diesel powerplant, enthusiasts should be able to have their tire-shredding cake and eat less at the pump in the process.

 

[RangerRay]

YES!  We need more small diesels for passenger cars, SUVs and compact pick-ups.  They are far more fuel efficient and cleaner than petrol engines.  The rest of the world runs on diesel, yet we in North America are still in the dark ages with gasoline.

It's funny that you can buy a diesel powered Jeep, Land Rover, Toyota Hilux or Land Cruiser anywhere in the world...except for North America. 

 

[a_majoor]

I especially like how versatile diesel engines are. Two and four stroke diesels, super and turbocharged models, even turbocompound models that use the turbine to send energy back to the transmission.

For perhaps the ultimate expression of diesel engine technology, Google the Napier "Nomad" engine and then the Napier "Deltic" engine. Gearheads will salivate at the British obsession of bodging things together to squeeze the absolute maximum performance from the engine. The "Nomad" took turbocompounding to the logical conclusion (the deisel engine was essentially the gas generator for the turbine), while the "Deltic" took volumetric efficiency to unexplored realms (and then taking the turbine stage from a Rolls-Royce Nene turbojet for the ultimate turbocompounded version, generating close to 6000 Hp from a 5384 cubic inch displacement engine....)

Rudolf Diesel had calculated the ultimate thermal efficiency of his engine could be has high as 75%, although the state of the art in the late 1800’s and early 20th century was not able to support anything near these numbers. Diesel’s calculations were based on the idea of a massive 52:1 compression ratio, air injection of fuel (to promote atomization) and water injection (to reduce the flame temperature). The flame temperature at TDC (where fuel was injected and combustion initiated) was calculated to be over 20000, while the temperature at BDC was to be about 3000, ensuring as much thermal energy as possible was extracted.

While these are probably not the sort of engines you might find in the family minivan, they give you a good idea of how far IC technology can go.

 

[FlyingDutchman]

With gas locally at 100.9 and diesel at 137.9 I would rather drive gas for a little longer.

 

[psionic0]

With gas locally at 100.9 and diesel at 137.9 I would rather drive gas for a little longer.

You must live on the west coast or something!? I haven't seen gas that cheap in a long time. Here in Pet, it's still at 122.9

 

[Canadian.Trucker]

With gas locally at 100.9 and diesel at 137.9 I would rather drive gas for a little longer.

I can see your thinking, but hypothetically if overall the fuel efficiency of diesel is greater and upon comparison in the same vehicle you get approximately 700km's/tank with gas and 1,000km's/tank with diesel, does it not even out and perhaps bring greater benefit to drive diesel?  I say this also with the historical tendency that diesel prices don't seem to fluctuate as much as gas prices.

Oh, and I am quite jealous that you're paying just over a buck/litre for gas... you lucky devil!

 

[RangerRay]

With gas locally at 100.9 and diesel at 137.9 I would rather drive gas for a little longer.

You must live on the west coast or something!? I haven't seen gas that cheap in a long time. Here in Pet, it's still at 122.9

The west coast (Vancouver) would be around 150.9 with carbon taxes and transit taxes.  Sounds more like Alberta gas prices, though diesel seems kinda high.

Here in Winnipeg, petrol is around 108.9...not bad!

 

[FlyingDutchman]

I am in BC, and bought gas for less than a dollar a litre last night.  I only had $5 on me, but I had no idea how much longer the price would be 99.9. 

At the time when I was buying my current car, I did look at diesel vehicles, and diesel was cheaper then.  None of them really fit the needs my wife and I had.  I echo the statement about there not being enough diesel vehicles.

 

[a_majoor]

Trying to keep the bubble inflated for just a little longer....

http://www.zerohedge.com/news/gm-channel-stuffing-surges-all-time-record

GM Channel Stuffing Surges To All Time Record
Submitted by Tyler Durden on 12/01/2011 17:15 -0500

Gross Domestic Product

In the past two months, everyone has been scratching their heads just how it is possible that the US manufacturing base continues to chug along at pre-recession levels even as the world all around America burns? Today, GM may have given the answer, courtesy of its monthly disclosure of car sales which at the top line is completely irrelevant as the funding for these purchases comes almost entirely from subprime loans handed out by the government to NINJAs. What is interesting is the little blurb in every monthly report discussing the amount of dealer inventory, a topic well-known to frequent readers of Zero Hedge which has discussed GM's pervasive channel stuffing in the past, and which subsequently went quite mainstream. So how does November channel stuffing stack up? As the chart below shows, at 623,666 cars, it is an all time absolute record, and represents about 3.5 times the total GM vehicles sold in November! It is also a 31k increase in the past month, and 85k cars more in inventory than in July. Because when economic growth at all costs is needed to demonstrate just how viable America is, and a semi-nationalized car marker is one of the only conduits to "generate" economic growth, it does not matter if the end product is actually demanded or will simply corrode and rust in some dealer showroom in perpetuity. After all it is the act of building the car that matters for various monthly PMI, CMI, regional Fed and GDP purposes. Pretty much exactly like in China's goal seeked "economy." So the next time someone asks just how is it that the miraculous US decoupling continues, please point them to this chart.