Archives

Lutz: "Well 'they (Europe) know how to do it (higher fuel economy)' at eight bucks a gallon where everybody buys tiny little cars with tiny, tiny diesel engines...that don't have to meet US diesel emissions regulations..." (http://money.cnn.com/news/newsfeeds/articles/djf500/200801202228DOWJONESDJONLINE000419_FORTUNE5.htm)

http://www.cleanmpg.com/photos/data/501/bob_lutz.jpgCNN Money - Jan 20, 2008

Granted, European cars have always been smaller, but does it seem like Lutz and a number of Americans are obsessed with size? - Ed

DETROIT (Dow Jones) -- He is a former Marine jet attack aviator who later rose to the top echelons of General Motors. And like a Marine, Bob Lutz is blunt and to the point when it comes to talking about the future of the industry he loves.

He told MarketWatch the government is putting automakers "at war" with their customers, that the cars of the future will be more fuel efficient but very different and more expensive, and that GM is seeing some encouraging economic signs. We talked with GM's Vice Chairman for Global Product Development at the Detroit auto show this past week.

Lutz said the new government requirement that automakers have a Corporate Average Fuel Economy of 35 miles a gallon by the year 2020 will change the way we go from Point A to Point B.

"The cars that get 35 miles per gallon...will not be like the cars and trucks that get 20 miles per gallon today. They will be somewhat smaller...they will contain lots of fuel-saving technology, and that technology will not come for free," Lutz said. He predicted those cars would cost "five, six, seven thousand dollars more."

GM is working with battery makers to get the much-talked-about electric vehicle, the Chevy Volt, to market by 2010...http://money.cnn.com/news/newsfeeds/articles/djf500/200801202228DOWJONESDJONLINE000419_FORTUNE5.htm

What do you suppose the purpose of making and selling cars is? It is to make a profit.

Small cars cost about the same to make as bigger vehicles but people are will to pay more for bigger vehicles. $35,000 economy cars just won't sell.

What do you suppose happened to the Honda Insight. It was a little jewel of a car and got fabulous MPG, but Honda lost their shirt on every one they sold at that price. It was a "loss leader" sold exclusively for the purpose of burnishing Honda's "Mr. Clean" image.

Doe Toyota make money on the Prius? Maybe but if so, not much. Sooner of later somebody at toyota will ask why they are "trading yen" making these things at low margin and not exactly tremendous volume.

Tier II forecloses efficient car diesels in America except at incredible price premiums.

If MPG were truly that important, why can we not get the extremists at the EPA out of the way.

He is concerned with size because (like he said) that is what people buy. I'd have to (mostly) agree with pretty much everything he said. If Americans are not willing to compromise and get rid of their V8s, its going to be hard to get to a 35 mpg fleet average.

However it would be nice if, instead of fighting the government every inch of the way, they would put some effort into informing the public and winning them over. But, I guess that goes against the old saying 'the customer is always right' wouldn't it? :rolleyes:

"Because with the federal mandates at 35 miles per gallon coupled with cheap fuel, it puts us at war with our customers. At $3 a gallon (for gas) many people still want full-sized pick up trucks (and) full-sized sport utilities with V8 engines..."

And why is that, Bob? Have anything to do with decades of high-pressure marketing, brainwashing Americans into thinking they are losers unless they drive the latest V-8 status symbol from Detroit?

Blame yourself and your cronies, Bob, if Americans have a fetish for large gas hogs.

Harry

"The cars that get 35 miles per gallon...will not be like the cars and trucks that get 20 miles per gallon today. They will be somewhat smaller...they will contain lots of fuel-saving technology, and that technology will not come for free," Lutz said. He predicted those cars would cost "five, six, seven thousand dollars more."

What a character. Bob is such a funny guy.

Of course the technology does not come for free.

But then again, had he not publicly dismissed fuel saving technology (particularly hybrid tech) earlier on perhaps those costs would be a little lower now, especially when under the pressure of an FE mandate?

His whining is mind-numbing to some of us.

Cheers;

MSantos

[QUOTE=Delta Flyer;66188]Lutz: "Well 'they (Europe) know how to do it (higher fuel economy)' at eight bucks a gallon where everybody buys tiny little cars with tiny, tiny diesel engines...that don't have to meet US diesel emissions regulations..." (http://money.cnn.com/news/newsfeeds/articles/djf500/200801202228DOWJONESDJONLINE000419_FORTUNE5.htm)

I always thought that the problem was not making the cars meet the diesel emission regulations, but rather the diesel itself being clean enough for auto-use.

After-all, it is called auto-diesel here in europe. That name came sometime in the 80's.

Is it particulates or NO-x/SOx gases that are the problem for US diesel cars?

What do you suppose the purpose of making and selling cars is? It is to make a profit.

Small cars cost about the same to make as bigger vehicles but people are will to pay more for bigger vehicles. $35,000 economy cars just won't sell.

What do you suppose happened to the Honda Insight. It was a little jewel of a car and got fabulous MPG, but Honda lost their shirt on every one they sold at that price. It was a "loss leader" sold exclusively for the purpose of burnishing Honda's "Mr. Clean" image.

Doe Toyota make money on the Prius? Maybe but if so, not much. Sooner of later somebody at toyota will ask why they are "trading yen" making these things at low margin and not exactly tremendous volume.

Tier II forecloses efficient car diesels in America except at incredible price premiums.

If MPG were truly that important, why can we not get the extremists at the EPA out of the way.I'm well aware of the fact automakers are in business for a profit. One way to insure this is to look beyone the next quarter or two, like Toyota. In case you have not noticed, the Prius is profitable and in the top-10 in US sales...Toyota is planning to have a Prius brand like Lexus, so it sounds like they are making a profit. ;)

The Honda Insight was a halo car for fuel efficiency and never intended to have the volumn of the Civic or Prius.

Big Dave, I don't know where your are getting your information that small cars typically cost $35,000, but that's considerably over the price tag of the Corolla, Yaris, and Civic to mention several fuel-efficient vehicles. Detroit made good profits off of sedans such as the Impala 30 years ago - better management and dealing with the UAW would keep the profit margins on sedans better today. At any rate, I see more "little car" purchases as of late with a lot of trucks up for sale.

The typical pre 1980 American car is a happy medium between the smaller European car and today's US cars - that would lighten up things at least 1000lbs per vehicle and improve fuel economy substantially.

[QUOTE=Delta Fl yer;66188]Lutz: "Well 'they (Europe) know how to do it (higher fuel economy)' at eight bucks a gallon where everybody buys tiny little cars with tiny, tiny diesel engines...that don't have to meet US diesel emissions regulations..." (http://money.cnn.com/news/newsfeeds/articles/djf500/200801202228DOWJONESDJONLINE000419_FORTUNE5.htm)

I always thought that the problem was not making the cars meet the diesel emission regulations, but rather the diesel itself being clean enough for auto-use.

After-all, it is called auto-diesel here in Europe. That name came sometime in the 80's.

Is it particulates or NO-x/SOx gases that are the problem for US diesel cars?


The problem as I see it, Shrek, is not the diesel engine or European diesels emissions. The big three don't see any need for letting in high MPG vehicles that would compete with their low MPG vehicles. They (the Auto/Oil cartel are making far too much money to let that come in here. US diesel emission regulations were put in place to keep European vehicles out. They did, however, figure out a way around this legislation to sell their low MPG diesel pick ups and SUV's here. They are classified as trucks, thus making them exempt.

This, in my mind, clearly delineates the hypocrisy of the big 3. On one hand the are trying to paint themselves as green (Chevy, with many over 30MPG vehicles for you to choose from) and then there are articles like this one that show GM's true intention. It's all about greed, and they want to keep it going for as long as possible, whatever the cost and regardless who is hurt.:mad:

Suffice to say, "small" is larger than it used to be ;)

Mike Jackson, head of AutoNation, the biggest US car-dealership chain, had a sobering message in a presentation delivered on the sidelines of the show. For Europeans and Japanese, says Jackson, buying a car is all about fuel economy. For the Chinese and other emerging-market buyers, price is the chief consideration.

But for Americans, “It’s about Me”. This means, according to one survey, that audio systems, cupholders and luggage capacity are still more important than fuel economy to the American buyer. The average US vehicle weight has climbed from 3,221lbs to 4,144lbs since 1987. Average horsepower has risen from 118 to 223. Meanwhile, fuel-economy has slipped from 22 to 20.2 miles a gallon.

Of course, the best way to get Americans out of their gas-guzzlers would be to raise petrol taxes. Dream on. No mainstream politician or car-industry executive dares risk a public flogging by suggesting that.

From > http://www.ft.com/cms/s/2/dd053bf6-c524-11dc-811a-0000779fd2ac.html

I have mixed feeling about Bob Lutz. On one hand, he has had a hand in getting GM to develop some competitive cars of late like the new Malibu and CTS. On the other hand, every time he talks about improving fuel economy, he complains how expensive it is to do so or how it will cause cars to shrink to almost unsafe sizes.

Shrek, North America started to use diesel fuel with sulfur levels similar to Europe's fuel about a year and a half ago. The regulations that diesel cars have to meet are tougher here. NOx is 5 times lower than Euro IV and PM is 2.5 times lower.

Hi All:

___The only thing I have to say is GM is being embarrassed on the low end by the likes of the Yaris, Fit, Corolla and Civic. In the mid-range area, the upcoming Jetta TDI at maybe $20K for an S and a stick (if they come equipped that way?) will do damage to GM’s views on small diesels let alone the $22K HCH-II’s and Prius hybrids. On the high-end, the upcoming BMW 335d and/or Audi A4 w/ its 3.0L TDI will have all the FE of one of their compacts but with larger size, far more amenities and performance (it is a BMW and Audi after all). What will they hide behind then? Then the 50 mpg European Ford Mondeo is every bit as large as their current Malibu only with close to double the FE?

___Good Luck

___Wayne

What I find perplexing about all of this, and especially this interview, is that Detroit fails to see that here is a tremendous opportunity to sell everyone a new vehicle! They have tremendous marketing power, and they could easily persuade all the people who currently have FSP's (fuel-sucking pigs - is that in the glossary yet?) that times have changed and Americans should buy new FE vehicles.

And also that smaller profit margins on a LOT of vehicles beats selling a few units at their current margins, which is where they are heading.

Instead we get all this whining and empty promises. I loved the bit about how he thinks EV is the way to go - so what happened to GM's EV-1???

Wow Lutz is typical of the GM attitude that goes back decades. What an opportunity the manufactures have to make some significant advances in automobile design. My FEH averages 30 mpg its a 4000 lb SUV. If it had a bigger battery pack it could most likely reach 35 mpg esp if it was a mild plug in. If Gm had of put the development of a FWD hybrid trans axle instead of the Tahoe/Suburban RWD hybrid they would be coming out with a Malibu hybrid 38 mpg and Equinox hybrid 31 mpg maybe a little later a Cobalt hybrid 45 mpg. Of course they could make them a little more fun, a little more zippy. There is no reason you cant have a performance and fuel economy hybrid. Latter when Li-ion batteries become feasible all of these could be evolved into plug in hybrids ands nearly double or triple the mpg. Don't you think people would be excited to be able to buy a Pontiac G6 with a hybrid drive that has the performance of a big V-6 and still gets 40 mpg IN TOWN? How about a cute little Cobalt that got 48 mpg. I think they might fall in love with American cars again.

Wow Lutz is typical of the GM attitude that goes back decades. What an opportunity the manufactures have to make some significant advances in automobile design. My FEH averages 30 mpg its a 4000 lb SUV. If it had a bigger battery pack it could most likely reach 35 mpg esp if it was a mild plug in. If Gm had of put the development of a FWD hybrid trans axle instead of the Tahoe/Suburban RWD hybrid they would be coming out with a Malibu hybrid 38 mpg and Equinox hybrid 31 mpg maybe a little later a Cobalt hybrid 45 mpg. Of course they could make them a little more fun, a little more zippy. There is no reason you cant have a performance and fuel economy hybrid. Latter when Li-ion batteries become feasible all of these could be evolved into plug in hybrids ands nearly double or triple the mpg. Don't you think people would be excited to be able to buy a Pontiac G6 with a hybrid drive that has the performance of a big V-6 and still gets 40 mpg IN TOWN? How about a cute little Cobalt that got 48 mpg. I think they might fall in love with American cars again.

And here's an idea on how to sell the public on getting a fuel efficient vehicle. Instead of showing all the smug rich women driving their Cadillac Escalades and Hummers, how about showing a couple of regular guys who work at the same cubical farm. It's Friday, and Jim and Joe are leaving work to start the weekend. Jim says he's going up to the mountains (or down to the beach, whatever) and Joe says, how the heck can you afford to go that far with the price of gas these days? They're in the parking lot now and Jim looks at the full size 8 cyl truck/suv Joe is about to get into, and then over at his own Prius/HCH/Yaris/Corolla/Volt etc. and just smiles...

Hi Pumaman:

___We would all love to see this but the fact still remains GM makes more on a single Tahoe then probably 20 Cobalt’s or Aveo’s. I am sure Toyota makes more on a single Tundra then a dozen Yaris’ as well.

___If you were a CEO whose job depended on the bottom line year after year, where would you place your advertising $’s?

___The fact remains that only gas prices and a realization that the FSP’s depreciation is so far beyond that of a smaller and far more fuel efficient vehicle it is almost ridiculous. Someday all these upside down owners are going to recognize that their $37,000 FSP investment is worth only $12K after 2 years and hopefully the light bulb would light up and they will say, “Wow, I could have bought a Prius!”

___Good Luck

___Wayne

There are actually a couple of fuel economy slanted ads on right now.

One is for Kia Spectra, in which the owners keep forgetting which side of the car the gas fill is on because they use it so seldomly.

The other is the one where two young guys are heading out on a road trip and the owner of the car says he'll pay for gas and the other guy can pay for food. Then they show them stopping and getting all sorts of food but never having to get gas. The guy who bought all the food says he'll pay for gas next time. This could be part of the Spectra campaign, but I'm not sure.

You'll note they don't make a comparison between vehicles.

I agree that the companies that make most of their money from large expensive vehicles won't compare them unfavorably to less expensive fuel efficient models. Maybe someone like Aptera could use that angle.

call me crazy, but if CAFE is an *average* then won't a handful of Volts offset a whole bunch of guzzler hulks? I don't see the big deal here.

Mike Jackson, head of AutoNation, the biggest US car-dealership chain, had a sobering message in a presentation delivered on the sidelines of the show. For Europeans and Japanese, says Jackson, buying a car is all about fuel economy. For the Chinese and other emerging-market buyers, price is the chief consideration.

But for Americans, “It’s about Me”. This means, according to one survey, that audio systems, cupholders and luggage capacity are still more important than fuel economy to the American buyer. The average US vehicle weight has climbed from 3,221lbs to 4,144lbs since 1987. Average horsepower has risen from 118 to 223. Meanwhile, fuel-economy has slipped from 22 to 20.2 miles a gallon.

Of course, the best way to get Americans out of their gas-guzzlers would be to raise petrol taxes. Dream on. No mainstream politician or car-industry executive dares risk a public flogging by suggesting that.

From > http://www.ft.com/cms/s/2/dd053bf6-c...0779fd2ac.html (http://www.ft.com/cms/s/2/dd053bf6-c524-11dc-811a-0000779fd2ac.html)
Now check out the newbies' response from last night at F350super dutyV10-4x4 (http://www.cleanmpg.com/forums/showthread.php?t=8342) - esp. some of the last ones. If you take them at face value, you are forced to conclude that America before 1985 was a 2nd or 3rd world country due to our "small" vehicles during that era...that 95% or more of the suggestions at CleanMPG are unusable as we are a nation of commercial drivers helpless to change....recession - even depression is inevitable - really? ;)

There are actually a couple of fuel economy slanted ads on right now. .....

The other is the one where two young guys are heading out on a road trip and the owner of the car says he'll pay for gas and the other guy can pay for food. Then they show them stopping and getting all sorts of food but never having to get gas. The guy who bought all the food says he'll pay for gas next time. This could be part of the Spectra campaign, but I'm not sure.

I think that's a Focus ad.

The Prius is just profitable at this point, but Toyota is planning to cut Hybrid system cost by 50% from the current ~$2500 to about $1250 in the next generation Prius despite the expected dramatic increase in performance. With a slight price increase justified by the better performance and feature content, the next generation Prius should make Toyota decent profit, comparable to their current compacts and mid size sedans.