The Truth About Cars » Obama The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Thu, 17 Jul 2014 12:00:21 +0000 en-US hourly 1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » Obama Solyndra, A123, Now LG Chem: Your Tax Dollars, Not At Work Thu, 14 Feb 2013 13:02:46 +0000

Three years ago, at a groundbreaking ceremony for an LG Chem Battery plant in Holland, Michigan, President Obama promised that this and other pants will be “a boost to the economy in the entire region.”  Instead, the plant has become an example for what is wrong with a state-directed command economy. It also is yet another chapter in the Chevrolet Volt debacle.

Half of the plant’s $300 million price was funded by the tax payer, courtesy of a $150 million government grant.  The  plant does nothing. Its workers  “had little work to do and were spending time volunteering at local non-profit organizations, playing games and watching movies at the expense of the federal government and taxpayers,”  Gregory Friedman, inspector general at the Department of Energy, concluded in a report made public yesterday.

At the groundbreaking, President Obama said:

“The workers at this plant, already slated to produce batteries for the new Chevy Volt, learned the other day that they’re also going to be supplying batteries for the new electric Ford Focus as soon as this operation gears up. That means that by 2012, the batteries will be manufactured here in Holland, Michigan.”

Not true. According to a Reuters report, the plant has not shipped “any products used in vehicles sold to the public.” Reports that ask why hear that the Volt did not sell in the expected quantities.

At the groundbreaking, Obama told workers that they are “leading the way in showing how manufacturing jobs are coming right back here to the United States of America.” Not true. The few batteries that are used in the Volt are made in Korea.  Workers in the plant show how tax dollars go to waste, spending “their time watching movies, playing cards and board games, or volunteering at local organizations – all on the U.S. taxpayers’ dime,” as the Reuters report says. The only batteries this plant ever produced were test samples that were destroyed.

At the groundbreaking, President Obama said:

“This is the ninth advanced battery plant to begin construction because of our economic plan. These plants will put thousands of people to work. This includes folks who are working at a couple of facilities being built in Michigan by another battery technology company called A123.”

A123 went bankrupt. Instead of bringing jobs back to America, the  plant was sold off to China.

At the groundbreaking, President Obama said: “This plant will prove that we are headed in the right direction.” The plant did just the opposite.

Even the Detroit News, usually very sympathetic to government programs that bring money to Michigan, can’t help itself, and writes:

“President Obama said in his State of the Union address on Tuesday that he wants to establish 15 “manufacturing hubs.” Hey, why set up 15 hubs? They can all just come to Holland and talk to the folks at LG Chem about how you succeed as a manufacturer by making nothing and selling nothing – while collecting lots and lots of government money.” 

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1 Million EV Goal Absent From State Of The Union Wed, 13 Feb 2013 16:30:56 +0000

Those who watched the State of the Union address last night and have an interest in autos may have noticed a conspicuous absence; Barack Obama failed to mention his goal of putting 1 million EVs on the road by 2015.

Obama last mentioned the figure in 2011, stating

At the California Institute of Technology, they’re developing a way to turn sunlight and water into fuel for our cars. At Oak Ridge National Laboratory, they’re using supercomputers to get a lot more power out of our nuclear facilities. With more research and incentives, we can break our dependence on oil with biofuels, and become the first country to have 1 million electric vehicles on the road by 2015.

Since then, the figure has been absent from the address. In 2012 did see Obama promise to  “…not cede the wind or solar or battery industry to China or Germany…” Well, we all know what happened to A123 Systems.


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Obama Chickens Out, Says A Million EVs By 2015 Not Important Thu, 31 Jan 2013 19:45:45 +0000

Today must be International Backpedaling Day. Volkswagen said “Never mind beat Toyota by 2018.”  Obama says: “Never mind a million EVs by 2015.”

Under a new strategy announced today, the Department of Energy promised to support research into new battery technologies and manufacturing methods that would lower the cost of lightweight materials and improve vehicles’ fuel-efficiency, Reuters reports.

But the DOE backpedales furiously from a goal set out in a 2011 State of the Union speech, where President Barack Obama announced what he called “Apollo projects of our times.” One of them was the goal for the United States to be “the first country to have a million electric vehicles on the road by 2015.”

“Whether we meet that goal in 2015 or 2016, that’s less important than that we’re on the right path to get many millions of these vehicles on the road,” an unnamed Energy Department official told Reuters.

Reuters notes that “demand for hybrids and electric vehicles has been weaker than expected.” Government money was poured into black holes. Says Reuters:

“Poor demand has hurt lithium-ion battery makers, pushing two DOE grant recipients, A123 Systems Inc and EnerDel, to file for bankruptcy protection. Dow Chemical Co took a $1.1 billion charge last year, related in part to a writedown of its lithium-ion battery business, Dow-Kokam LLC.”

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Did Government Meddling Cripple The Dodge Dart? Fri, 25 Jan 2013 22:25:47 +0000

As we come to yet another hiccup in the launch of the Dodge Dart, it’s worth taking a look backwards to examine how we got to this point; the elimination of a second shift at the Dundee, Michigan plant that builds the Dart’s 1.4L FIRE engine, as well as the firing or re-assignment of 58 workers.

As both Ronnie and Michael Karesh noted, the same 1.4T FIRE engine that’s so delightful in the Fiat 500 Abarth is weaksauce in the Dart. The 1.4T’s clunky dual-clutch auto doesn’t help matters either. If it weren’t for government mandated fuel economy targets imposed as a condition of the bailout, that engine – and possibly the Dart – wouldn’t even be here right now.

Just over a year ago, UAW members at the plant had just authorized a strike at the Dundee plant over a change in shift schedules – despite an apparent agreement not to strike, as another condition of the bailout. The FIRE engine, widely panned in the Dart, seems to exist solely to satisfy the requirement that Fiat build a 40 MPG car in America – a requirement that TTAC summarily exposed as bogus, since the agreement stated that the car must get 40 MPG “unadjusted”, or roughly 30 MPG combined in the “real world” fuel economy figures that everyone is familiar with.

But without the 40 MPG Dart, the diminutive FIRE engine and U.S. production of the FIRE engine, Fiat would not have received their 20 percent stake in Chrysler, along with the option to increase their share in 5 percent increments once these milestones (the third being Fiat recording $1.5 billion in revenue outside the NAFTA Zone).

Ronnie hit the nail on the head with his summation that the Dart, as Chrysler’s first product overseen by Marchionne, was at best the victim of a botched launch, and at worst a failure made of cobbled together Chrysler and Fiat parts. But the 1.4T seems to have been a victim of meddling by the current administration instructing car companies to build vehicles consumers don’t want – a charge often leveled at the Chevrolet Volt by its more vocal critics. In this case, it’s not a complex hybrid/electric pseudo-hatch, but an underpowered version of a nicely executed compact car that was hamstrung by political pressure – that may or may not have led to a botching of the car’s launch.

The initial batch of Darts that arrived on dealer lots used the 1.4T or 2.0L non-turbo engine and were largely equipped with stick shifts – popular among “Petrol Hipsters”, but poison for the other 95 percent of American car buyers. The mismatch in product mix has been blamed for the Dart’s slow start. Next up, Sergio Marchionne himself blamed the lack of a 9-speed automatic, telling the media that buyers found the 6-speed dual clutch gearbox to be an oddity. Now it looks like the issue may lie with the FIRE engine itself; too pokey and too small for American tastes, let alone for a 3200 lb car (for comparison, the Fiat 500 Abarth that uses the FIRE engine weighs 2500 lbs and provides fairly rapid acceleration). The irony is that only one model, the 1.4T equipped Dart Aero, actually gets 40 MPG or above. Since the government agreement specified that the 40 MPG car be “produced in commercial quantities”  without any concrete definition, it’s impossible to know how many 40 MPG Darts actually made their way into the hands of consumers. Interestingly enough, the Dart Aero is broken out as a separate model on the EPA’s fuel economy website

As a replacement for the FIRE and its capacity at the plant, Chrysler will use Dundee to build the 2.4L Tigershark 4-cylinder engines that will apparently be a much better fit for North American drivers, rather than the small turbo engine that’s more at home in A and B segment Fiat products. The 2.4L hasn’t been rated by the EPA for fuel economy yet – it likely won’t hit the 40 MPG mark, but its smoother, torquier nature is more akin to what American consumers are used to. But if it weren’t for politicians deciding that they knew better, and that filling some nebulous “green car” mandate was a holy task, this whole mess could have been avoided, and the Dart may have had a much better chance to succeeding in an already tough compact car segment.




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Wall Street Journal Misses Its Mark With The Dart Wed, 19 Sep 2012 16:15:33 +0000

It’s the kind of mistake that only a blogger (said with a contemptuous sneer) would make. The Wall Street Journal reports that

“U.S. regulators rated a new Chrysler Group LLC compact car with highway fuel-economy of 41 miles a gallon, a move that fulfills a key element of the company’s 2009 federal bailout and cleared the way earlier this year for majority owner Fiat SpA to increase its stake in the Detroit auto maker.”

They got it wrong.

To hear the WSJ tell it, you’d be led to believe that

“Italy’s Fiat took control of Chrysler in 2009 after agreeing with the U.S. government to help the U.S. auto maker produce a line of new fuel-efficient on cars based on Fiat designs. Fiat was originally given a 20% stake in Chrysler, and was allowed to increase its holding for achieving certain goals, one of which was helping Chrysler produce a car that goes at least 40 miles on a gallon of gasoline.”

The WSJ isn’t technically wrong – one of the stipulations was for Fiat to help Chrysler produce a 40 mpg car. But it had nothing to do with 40 mpg highway, the Dodge Dart Aero, or even the current fuel economy regulations as we know them.

As our Editor Emeritus Ed Niedermeyer reported back in 2011, the requirement, as stipulated by the U.S. government, was for Fiat to produce a made-in-America car that got a combined 40 mpg unadjusted. This means, crucially, that the combined figure is calculated using the pre-2008 fuel economy calculation standard that led to inflated fuel economy ratings. How much of a difference does this really make? Ed laid it all out unsparingly

“40 MPG combined unadjusted translates to almost exactly 30 MPG combined on the “adjusted” EPA test cycle which is used to produce window stickers for vehicles currently on the market. This is hardly a benchmark for a meaningful “Ecological Commitment” in the sense that a significant number of currently-available mass-market cars currently achieve this standard, and the cleanest vehicles on the market exceed it by dramatic amounts. According to the EPA, at least 11 2010 model-year “compact cars” currently achieve the 30 MPG combined adjusted standard. At least six “midsize sedans” achieved the magic number for the outgoing model-year, as did two “upscale sedans,” two convertibles, two station wagons and three SUVs (although the SUVs are all derivatives of the Ford Escape Hybrid).”

The WSJ uses the 2013 Dodge Dart Aero as its example, but the Dart Aero isn’t the sole model to get the 40 MPG unadjusted combined figure – the base 1.4L 6-speed manual car returns 32 mpg combined, while the automatic 1.4L returns 31 mpg combined, which would place them above the 40 mpg unadjusted cutoff value. The Aero models get 32 mpg combined with either transmission. Meanwhile, Darts with the 2.0L 4-cylinder get 29 mpg combined with the manual (just missing the mark) and 27 mpg with the automatic.

While Ed already explored the inside story of how a few word choices effectively torpedoed any chance for meaningful advancement in fuel efficiency, (while giving Marchionne & Co a free slice of Fiat), the “40 MPG meme” is still alive and well. For all the darts that the WSJ has thrown at the Obama administration, one would think that they’d be the last entity to let the Dems dodge their well-aimed crosshairs on this issue.


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Apolitics: Washington Or Bust Fri, 03 Aug 2012 17:28:31 +0000

White House spokesman Dan Pfeiffer apologized to WaPo and Fox News commentator Charles Krauthammer for having “overshot the runway.” Pfeifer had accused Krauthammer of falsely claiming that a bust of former British Prime Minister Winston Churchill had been removed from the White House and sent back to the British Embassy. In a blog post on the White House Blog (yes, the White House blogs too) Pfeiffer produced a smoking gun: A Churchill bust that was still at the White House.  The trouble was there had been two busts. Now there is only one.  (See, and I would have sworn Bill Clinton took all available busts when he vacated the White House.)

What do busts have to do with cars?

While we are on the topic of apologies, Bob Lutz could join the White House, clear the air, and apologize to Krauthammer. On March 19, the cigar-chomping, journalist-charming Lutz accused his former friend Krauthammer of “deliberately not telling the truth.” Lutz did so in the capitalist tool Forbes. Krauthammer had called the Chevrolet Volt (see, we will get to cars eventually) an example of Obama’s misguided, interventionist energy policy. And he called the car “flammable.” Lutz was incensed and flamed Krauthammer. Octogenarian former Vice Chairman flames sexagenarian Washington insider! What is this world coming to.

According to a recent op-ed post by our dearly departed Op-Ed Niedermeyer in Investor’s Business Daily, the Volt still is an example of Obama’s misguided, interventionist energy policy. 1.2 million EVs by 2015? 120,000 Volts in 2012? GM will be lucky if the Volt will hit its very much down-revised goal of 20,000 this year.  In the first 7 months, the Volt sold 10,666. Despite a presidential spokesman flogging the Volt at every occasion, the Volt is outsold by cars as ignore-worthy as the Mitsubishi Galant. You want proof that this sliver of a segment is misguided? The Leaf sold only 3,543. Mention EVs these days in the industry, and if you don’t happen to talk to a C.A.R.B. official, or a Terry McAuliffe who will sell you a factory in Inner Mongolia because he ran out of Brooklyn Bridges, and the answer will be a cough, or a rapid rolling of the eyes.

If the White House spokesman can apologize for overlooking a double bust and calling Krauthammer a liar, then Lutz can follow the example set at the very top, and apologize for calling Krauthammer a liar. Do it, Bob. America loves contrition.  And it will serve a worthy cause:

While we all are apologizing, TTAC will apologize as well! What did we do? You tell us. Tell us what we should apologize for, and if Lutz apologizes to Krauthammer, we will apologize to whomever for whatever our most heinous sin may be.

You decide – we apologize.


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Guess Who’s Supposed To Save Saab Now? Thu, 17 May 2012 11:38:20 +0000 Fritz Henderson could not save Saab.

Victor Muller could not save Saab.

Vladimir Antonov could not save Saab

Pang Qinghua could not save Saab.

Rachel Pang could not save Saab.

Now, Barack Obama is supposed to save Saab.

At least that’s how the Swedish metalworker union IF Metall sees it.
The union sent written a letter to president Barack Obama, urging him to use his good offices “to force former Saab owner General Motors to release the technology licenses for any potential buyer for Saab.” At least this is how The Local sees it.

The letter says:

“Our hope is that you will feel that Saab Automobile is worth being saved. We, more than 4,500 car workers in Sweden, look forward to your answer.”

Saab is in bankruptcy proceedings, and the receivers are evaluating bids. Saab is worth very little without the technology licenses held by GM, and, for that matter, without the brand held by defense contractor SAAB AB.

GM has been on record many times that it does not intend to license its technologies to any buyer of Saab in any shape or form.


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Blind Spot: Obama No Longer Dreams Of Electric Cars Tue, 13 Mar 2012 00:00:31 +0000

“The electric things have their life too. Paltry as those lives are.”

Phillip K. Dick, Do Androids Dream Of Electric Sheep?

At the High School I attended, progress reports were never a good thing. Halfway through each term, students who were averaging a D or lower would receive a print-out of their grade accompanied by a line from the teacher explaining how the miscreant in question was failing to live up to expectations. True to form, the White House’s just-released “One Year Progress Report” [PDF] on President Obama’s “Blueprint For A Secure Energy Agenda” includes some devastating evidence of abject failure. But unlike my post-progress report conversations with the parental stakeholders, Obama has a lot more to explain to voters than a simple “insufficient homework turned in.”

Just over a year ago,  in his 2011 State Of The Union, President Obama unveiled plan to stimulate “One Million Electric Vehicles By 2015,” arguing that

“With more research and incentives, we can break our dependence on oil with biofuels, and become the first country to have a million electric vehicles on the road by 2015″

Shortly thereafter, his Department of Energy released a report that touted wildly-optimistic production goals for several pure-electric cars, concluding that

Reaching the goal is not likely to be constrained by production capacity. Major vehicle manufacturers have announced (or been the subject of media reports) that indicate a cumulative electric drive vehicle manufacturing capacity of over 1.2 million vehicles through 2015.

Strong incentives, research and development, and assistance in establishing manufacturing and infrastructure is underway or planned. These activities directly support consumer demand of these technologies, and mitigate some of the uncertainty associated with the large-scale adoption of electric drive vehicles.

That argument became conclusively moot this year, when production of the Chevrolet Volt was stopped for the third time in its short lifetime, as unwanted cars piled up on dealer lots. Though the Volt has been defined as a symbol of GM’s bailout, it is even more politically significant as a component of Obama’s bold million-plugin plan. In last year’s report, the Department of Energy estimated that 120,000 Volts would be put on the road in the US this year, when the Volt hs actually only just broke 1,000 units sold per month for the first time in February. That 90% discrepancy between expectation and reality is crucial to Obama’s pledge, as the “1.2m production capacity through 2015″ that the DOE took for granted included some 505,000 Volts (at 120k/year from 2012-2015). With the Volt selling at 10% of DOE estimates, the entire goal falls apart (the next-closest vehicle, Nissan’s Leaf, isn’t estimated to hit 100,000 units per year until 2014).

Having seen the Volt’s underperformance coming, I’ve been wondering when the Obama Administration would recognize reality and admit that its goal was out of reach. But this being politics, you can’t just hand ammunition to your opponents. Admissions of failure must be couched in obfuscation and swaddled in unrelated good news. Which brings us to the just-released “Progress Report,” which is something like the polar opposite of landing on an aircraft carrier festooned with “Mission Accomplished” banners.

A sunny, upbeat document, the “Progress Report” introduces itself with wide-eyed optimism:

On the one-year anniversary of your Blueprint for a Secure Energy Future, which outlined your goals for American energy, we wanted to present a report on the significant progress we have made. During the last year alone, we established new incentives to increase safe and responsible domestic oil and gas production; proposed the toughest fuel economy standards for cars and trucks in history; provided millions of Americans with efficient and affordable transportation choices; launched new programs to improve energy efficiency in our homes, buildings, public transit, aviation and roadway systems; and took unprecedented steps to make the United States a leader in the clean energy

But if we skip ahead to the section regarding EVs, we find that all the sugary good news is just helping mask the rank scent of failure. So, how does a sitting president admit failure? It’s as easy as writing

“By 2015, the United States will be able to produce enough batteries and components to support one million plug-in hybrid and electric vehicles.”

Notice the key difference: then, the argument was that government action would put a million EVs on the road, now the argument is that the infrastructure will be in place to meet the goal. Oh, and in case you’re a fellow ADD-sufferer, remember that the DOE determined just one year ago that

Reaching the goal is not likely to be constrained by production capacity.

In essence this report repeats the exact same thing. The difference is simply that a year ago, the President could pretend that the market would simply soak up whatever number of EVs the car companies (most of whom had received some form of government support) said they would build. Now even the most hardened partisan can’t maintain such obvious self-delusion, as the demand for EVs (the Volt in particular) has been proven to be well below expectations. This failure is made explicit in the Progress Report, which notes that

in March 2012, the President launched a clean energy grand challenge to make electric-powered vehicles as affordable and convenient as gasoline-powered vehicles for the average American family within a decade.

In short, the message has gone from “thanks to government intervention, the future is now” to “thanks to government intervention, the future might be here in a decade.” Or, to quote a certain former presidential candidate, “whoops!”

Some might argue that this is a textbook example of government wasting money trying to affect the market, and a clear sign that the market is going to do what it wants regardless of our publicly-funded exercises in futility. Instead, President Obama is “doubling down” by requesting a billion dollars be spent on a “Community Deployment” scheme aimed at boosting demand for “advanced technology vehicles” through local partnerships, and tax credits for advanced technology vehicles be bumped to a maximum of $10,000. To be fair, the retreat from EVs is reflected in the new “technology neutral” approach, which doesn’t limit subsidies to EVs but

allow[s] communities to determine if electrification, natural gas, or biofuels would be the best fit.

But the proposed changes to the consumer tax credit [PDF] have some very vague and confusing stipulations, namely that

(1) the vehicle operates primarily on an alternative to petroleum; (2) as of the January 1, 2012, there are few vehicles in operation in the U.S. using the same technology as such vehicle.

The vagueness of those rules makes them hard to interpret, but it seems that clause (1) excludes high-efficiency, small battery plug-ins like the Prius Plug-In while clause (2) could well exclude natural gas vehicles (there were well over 100k NGVs on the road as of 2010). In which case, this policy is merely a continuation of the attempt to create a market for EVs (and since we’re talking disappointing technologies, possibly hydrogen cars). The community deployment scheme seems more technologically neutral, but is flawed in the extent that it assumes that local solutions will be more broadly applicable. Besides, most local governments with strong “green car” demand potential are already incentivizing public EV charging stations and the like. And don’t get me started about the fact that the government is even pretending that biofuels are a serious solution to either environmental or energy security concerns.

As gas prices go up, we could see EV and plug-in sales improve, but it’s clear that there won’t be one million EVs on American roads by 2015. Especially with policy appearing to shift towards a more “technology neutral” mode, there is a very real threat that the huge oversupply of natural gas could create a short term market for NGVs that could doom EVs for another decade or more. If the goal of Obama’s energy policy were to improve energy independence or help the efficient use of resources, this would be good news as it’s much easier and cheaper to build (and therefore, subsidize) NGVs than EVs (even without considering the low cost of natural gas itself). Unfortunately, we have already made a significant national investment in EV/battery technology, which satisfies yet another political constituency: environmentalists.

Without clearly communicated goals, government policies will never gain the credibility with markets they need to impact. And given President Obama’s track record so far, it’s clear  he needs to more clearly admit that his EV initiative has failed and express a clear set of goals for America’s transportation and energy sectors. Unfortunately, the fact that that he’s chosen to admit that the EV dream is over in such an oblique manner indicates that expecting such forthrightness would seem more than a little naive. All of which simply confirms that this issue, like so many others facing the nation, is no longer a question of policy, but of politics.

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Quote Of The Day: “Five Years From Now, When I’m Not President, I’ll Buy One Myself” – Obama On The Chevrolet Volt Tue, 28 Feb 2012 18:25:36 +0000 Click here to view the embedded video.

You heard it yourself. When Obama is out of office, he’ll buy a Chevrolet Volt and drive it himself. The Secret Service, which famously wouldn’t let Obama drive the Volt down the Hamtramck assembly line, generally protects the President for up to 10 years after they leave office – we’d assume that the “no driving” clause applies here. So Obama’s Volt may sit for a long time – hopefully it won’t brick.

Meanwhile, the DoE’s projection of 120,000 Volts produced in 2012 (let alone sold to consumers) still looks a little optimistic. GM just restarted production of the car a few days ago. Their sales target of 45,000 in 2012 has been abandoned after coming 2,300 units short of their 10,000 unit goal in 2011. GM now says that they will adjust “supply to meet demand”.


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U.S. Government Ignores Obama’s EV Plans, Cuts EV Purchases In Half Sat, 25 Feb 2012 13:25:15 +0000

Last year, President Barack Obama declared that one of the “Apollo projects of our times” is the goal for the United States to be “the first country to have a million electric vehicles on the road by 2015.” Companies that made and people that bought those electric vehicles received generous government money. One holdout in the rush for EVs: The U.S. government. It did not do as its President said, and ended up with a drastic cut in purchases of electric and hybrid vehicles after the speech was delivered.

GSA Purchases of EVs and Hybrids

U.S. General Services Administration purchases of hybrid and electric models fell 59 percent in fiscal 2011 to about 2,645, Bloomberg reports after analyzing data obtained through a Freedom of Information Act request.

The GSA procures approximately two thirds of the government’s vehicles . The other third is bought by the U.S. Postal Service.

The GSA bought 145 Chevrolet Volts in fiscal 2011, 1,380 hybrid Fusions, 101 Honda Insight hybrids and one Toyota Prius.

At the same time, the U.S. government is more in line with another Apollo project, namely buying only alternative-fuel vehicles for the U.S. government fleet by 2015. In fiscal 2011, the federal fleet added 32,000 cars and trucks that can burn E85. That’s 58 percent of the 54,843 cars bought by the GSA in fiscal 2011.

And it is a bookkeeping trick. 88 percent of the government’s “alternative-fuel vehicles” are flex fuel cars. They can use ethanol. But they can also use regular gas. They usually do.  Out of necessity: “There are only about 2,512 ethanol fuel pumps available among the estimated 162,000 fueling stations that sell gasoline,” says Bloomberg.

For years ago, Obama promised that by 2012, “half of all cars purchased by the federal government will be plug-in hybrids or all-electric.” They better write those purchase orders fast to meet that goal.

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Obama Snubs Foreign OEMs At D.C. Auto Show Thu, 02 Feb 2012 21:55:42 +0000

Foreign OEMs put on a dog and pony show at the Washington D.C. auto show in anticipation of President Obama’s visit, but were ultimately snubbed when the President decided to check out some American iron instead.

Bloomberg reports that Honda, Toyota and other foreign car makers flew in executives from across the country and brought in their most fuel-efficient cars at the request of the White House. While Obama checked out a display of American cars, including a Dodge Dart, a Ford Mustang Shelby GT500, a Chevrolet Silverado, a Jeep Grand Cherokee, a Chevrolet Corvette ZR-1, a Ford C-Max Energi and a Chevrolet Malibu, execs from the foreign OEMs waited in a “bullpen” for a chance to talk to Obama, and answer his questions about their products.

But they never got face time with the Commander-In-Chief. While a Honda FCX and a Kia Optima Hybrid were on hand (brought in specially for the visit), Obama only paid attention to the American brands – and some of their less-than-efficient products. While Obama was ostensibly checking out the newest wares of the automakers that got bailout money, many of the foreign OEMs have invested a lot of money in American manufacturing (as much as $43 billion, according to a trade group known as The Association of Global Automakers) – an economic sector in dire need of rejuvenation, and one that surely adds more value than a Facebook IPO.

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California Volt Drivers Get Carpool Lane Access Mon, 30 Jan 2012 18:39:46 +0000

Starting in March, the Chevrolet Volt will be eligible to use the HOV lane on California highways. The catch? You have to buy a new Volt to use the carpool lane.

General Motors added a secondary air-injection pump to the Volt’s catalytic converter in order for the Volt to meet certain emission requirements. The Volt will also qualify for a further $1,500 in tax credits as well as the HOV lane sticker. Any Volts sold before the new package comes into effect are shut out, and GM has been strategically reducing allocation of the cars to prepare for the launch of the revised Volt.

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White House Denies Delaying Chevrolet Volt Fire Announcement Mon, 16 Jan 2012 17:18:50 +0000

Obama! Socialism! Taxes! Jesus! Faith! Guns! Now that you’re paying attention, it’s time for our regularly scheduled programming. A Detroit News article claims that NHTSA is denying any interference on the part of the White House with respect to the Chevrolet Volt fires that resulted from government crash test procedures.

News of the fires only came to light in November, despite the fires occurring in June. NHTSA head David Strickland claims that the White House wasn’t informed until September. A letter sent to three Republican congressmen states that

“shortly thereafter informed the Executive Office of the President regarding the June fire and NHTSA’s test plans to determine if the fire indicated that there is a risk of post-crash fires in Chevrolet Volts. No one from the Executive Office of the President requested or in any way suggested that NHTSA delay public release of information related to the Volt fire,” 

GM previously announced a fix for the Volt’s battery pack and leaky coolant, which is said to have caused the fires. GM has yet to restart production of the Volt since the line went idle in December, and won’t be able to apply the new safety measures to the Volt until some time in February of this year.

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Howes: Ford Yanks Bailout Ad After White House Pressure Tue, 27 Sep 2011 14:25:41 +0000

[UPDATE: Ford has restored the video to Youtube. More details here.]

Detroit News columnist Daniel Howes reports in a column that Ford has pulled its controversial “bailout ad” after the White House asked “questions” about it. And apparently the take-down decision makes this a threatened piece of footage: in addition to yanking the spot from the airwaves, the version of the video we posted two weeks ago has been taken down from YOutube as well [a home recording of it can still be found here]. So what happened that Ford would throw its most popular ad in ages down the memory hole? Howes is cryptic…

Ford pulled the ad after individuals inside the White House questioned whether the copy was publicly denigrating the controversial bailout policy CEO Alan Mulally repeatedly supported in the dark days of late 2008, in early ’09 and again when the ad flap arose…

With President Barack Obama tuning his re-election campaign amid dismal economic conditions and simmering antipathy toward his stimulus spending and associated bailouts, the Ford ad carried the makings of a political liability when Team Obama can least afford yet another one. Can’t have that.

The ad, pulled in response to White House questions (and, presumably, carping from rival GM), threatened to rekindle the negative (if accurate) association just when the president wants credit for their positive results (GM and Chrysler are moving forward, making money and selling vehicles) and to distance himself from any public downside of his decision.

In other words, where presidential politics and automotive marketing collide — clean, green, politically correct vehicles not included — the president wins and the automaker loses because the benefit of the battle isn’t worth the cost of waging it.

Who were these “individuals inside the White House?” What questions did they have for Ford? And why on earth would Ford not stand up for itself in this situation? That GM was “carping” about the ad only makes this worse: the White House wasn’t just trying to smooth over the campaign trail, it was protecting its investment (remember, the government still owns a significant stake in The General) by “asking” a competitor to kill a successful ad. So, just how aggressively did the White House “ask” about this ad? Again, Howes is cryptic:

“This thing is highly charged,” says an industry source familiar with the situation. Ford “never meant it to be an attack on the policy. There was not any pressure to take down the ad.”

Maybe not technically. But the nexus of politics and the auto business in today’s Washington is bigger, broader and more complex than it arguably has been in who knows how long.

Gosh, if I had a reporter in the White House press corps, I’d be sure to have them ask about this. After all, this situation highlights perfectly why bailouts are so un-American. I don’t care who you are or how you felt about the bailout in the first place: at the point that the President is pressuring competitors to government-owned companies to yank truth-telling ads, you’ve got to wonder what happened to this country.

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Secret Service Buys Beastly Campaign Bus Mon, 15 Aug 2011 18:28:12 +0000 In the past, when a sitting president has hit the campaign trail, they’ve leased their own campaign bus which the Secret Service would then retrofit with all the latest security features. But no longer, as Talking Points Memo reports that the presidential bodyguards are buying their own bespoke campaign bus, reportedly from Hemphill Brothers Coach Company. Secret Service spokesman Jim Mackin explains

We’ve never been fully comfortable with the security provided by a bus we lease and then try to retro-fit. This would be just like other vehicles we’re adding to our fleet. We’d use them for the campaign, but they’re not for campaign purposes. They would be part of our fleet — just like our limos, just like our follow-ups, just like our emergency vehicles.

And this isn’t just for President Obama: one of the two new buses will be made available to the Republican candidate as well. And because the buses are government property, they won’t be allowed to have campaign logos and both campaigns will have to reimburse the Secret Service for their use. There’s no word on what retrofits the new buses will receive, but we’d be disappointed to find there’s not at least one minigun turret. Because you can never have enough miniguns on the campaign trail… [Hat Tip: Dan Licht]

Picture 438 Zemanta Related Posts Thumbnail Picture 436 Picture 435 Picture 432 A president's precedent... Picture 433 Picture 434


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Forza Italia: Fiat Takes Control Of Chrysler, Gummint Gone Fri, 03 Jun 2011 08:14:12 +0000 Fiat has reached an agreement with the U.S. Government that will give Fiat 52 percent of the shares in Chrysler and therefore the final controlling majorioty. The Treasury said on Thursday it will sell its remaining 6 percent equity stake in Chrysler to Italy’s Fiat in a deal that will net Washington $560 million, Reuters reports.

According to a statement of the Department of the Treasury, “The expected total proceeds to Treasury from this transaction are $560 million. Fiat agreed to pay Treasury $500 million for Treasury’s 98,461 shares of Chrysler. Treasury also held the right to proceeds above a certain threshold received by the UAW retiree trust from the trust’s sale of Chrysler equity, as well as a right to purchase all of the shares retained by the UAW retiree trust for a certain threshold amount – which Fiat will purchase for $75 million. Treasury will receive 80 percent of the proceeds ($60 million) from that $75 million, while the Government of Canada will receive 20 percent of the proceeds ($15 million).

Got that?

The Obama administration invested $12.5 billion in Chrysler. Chrysler will have returned more than US$11.2bn of that amount to taxpayers through principal repayments, interest, and cancelled commitments.

“Treasury is unlikely to fully recover the difference of $1.3 billion,” the government statement said.


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Obama Leaves London. And Unpaid Tickets Behind Fri, 27 May 2011 15:26:41 +0000

Headed for the G8 summit in France, President Obama left Britain today on Air Force One. He left a pile of unpaid traffic tickets behind. London’s Mayor Boris “BoJo” Johnson announced that he will bill the U.S. government 10 pounds for each car in the presidential motorcade, including The Beast that either did or did not get stuck in Ireland. The money is for the London congestion charge, abbreviated to C-charge. “Our roads were not closed during the President’s visit so his motorcade will pay,” the Mayor told London’s Evening Standard. “The Beast will pay the charge, I’m delighted to say.”

While it looks like The Beast will be billed, payment is a completely different matter.

A number of embassies in the capital insist the congestion charge is a tax, and that they are immune. The U.S. embassy carries the highest balance, with well over 45,000 notices since the C-charge was introduced in 2003. London insists it’s not a tax, it’s a toll charge.

A spokesman for the Mayor later said: “They already owe £5.3 million so it is probable the bill for the motorcade will just go on top of that.”

Meanwhile, back at the Buckingham Palace, they still are not amused by Barack Obama raising his glass to the Queen during the rendition of “God save the Queen.” He looks at her, thinks “well, if you don’t drink, I won’t either” and puts down the bubbly.

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That’s Low: Embarassing Beastiality Tue, 24 May 2011 16:48:35 +0000

Isn’t the idea of President Barack Obama’s truck-turned-limo that it can get out of a situation real fast? Instead, it caused howls of laughter all over Europe by getting stuck as it emerged from the gates of the US embassy in Dublin.

The low clearance of the car had problems with a little bump  at the gate.

According to the BBC, “the US President and First Lady then left by another exit.”

The Secret Service said later it wasn’t the real “Beast” that got stuck. They claimed “it was a spare limo, carrying staff and support personnel.” Traveling in low-riding style.

The Russian news channel RT has a longer version that shows how the view of the car is blocked by a huge grey van before the passengers emerge.

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Obama’s Moonshot: A Million EVs By 2015 Sun, 30 Jan 2011 11:19:46 +0000

In 1961, President John F. Kennedy said in a speech to a joint session of Congress: “I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the Moon and returning him safely to Earth.” On 21 July 1969, Neil Armstrong became the first man to set foot on the Moon. The Apollo 11 crew returned safely to Earth on 24 July. Three years later, the Moon had its last visitors. The Sea of  Tranquility lives up to its name.

In last week’s State of the Union speech, President Barack Obama’s set an even more audacious goal. Amongst the “Apollo projects of our times” is the goal for the United States to be “the first country to have a million electric vehicles on the road by 2015.”

Why is that more audacious? JFK only had to convince Congress to shake loose $7 billion. In the end, the project did cost $25 billion, the overrun surprised nobody. Obama has a tougher sell. He needs to convince a million Americans to buy an electric car.

Coincidentally, the U.S. again has more than $25 billion invested in advanced-technology vehicle development. With overruns, it will likely be more.

Michael Omotoso, director of global powertrain forecasting at J.D. Power and Associates thinks that Obama’s new Apollo project is “a stretch goal. We don’t think we’re going to reach that number by 2015,” he said to Automotive News [sub]. The high cost of batteries and the limited market for short-range compact cars will be obstacles that make a million EVs by 2015 a lot more difficult than a moon shot.

The U.S. Energy Information Administration also thinks the plan is ambitious. They see automakers selling about 281,000 electric cars and light trucks from 2011 through 2015.  That figure includes fuel-cell vehicles and excludes electric-gasoline hybrids. So far, a total of 326 Volts (which do not count as a pure electric vehicle) and 19 Leafs have been sold, according to company sales data compiled by Bloomberg.

Art Spinella, president of CNW Marketing Research in Bandon, Oregon, sees “a substantial gap between what the price is and what people are willing to spend.” He has a way to bridge that gap. Spinella thinks the president’s goal is “not only doable but probable” if the government backs it with at least $6.9 billion in federal and state tax credits. Again coincidentally, that is what JFK had asked for. And we all know how it ended. It did cost more than three times as much, and the moon remained unvisited for nearly 40 years.

Also coincidentally, while JFK threw down the gauntlet to the Soviets, Barack Obama finds himself in an EV race against the Chinese. They also want a million EVs by 2015. You think their job is easier, because they just order it, and it will be done?

Ask BYD how they are doing.

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Salesman-In-Chief Hawks Opel Ampera Sat, 20 Nov 2010 15:29:51 +0000

Isn’t it great to have the government as your biggest shareholder? Makes for good photo-ops. For the second time, Barack Obama went behind the wheels of a Chevy Volt, with the world press in attendance. Actually, it was the Volt’s European twin, the Ampera.

The Prez. had to weigh national security and time at the NATO summit in Lisbon against checking out the range extended Opel, and the Opel won.

According to Reuters, “Obama found himself acting as salesman-in-chief for GM Opel’s Ampera model just days after he declared in Washington that U.S. taxpayers would get their money back for saving GM in a bailout that was broadly unpopular.”

Then Obama said something that won’t go down well with Opel workers: “This is a car made in America. We’re going to start selling it in Europe.”

Actually, the Volt was designed with heavy input from Saab and Opel engineers. The brains of the Volt were developed at Opel in Mainz-Kastel. The Ampera production had been shopped around by Nick Reilly in Europe to attract government money. For the time being, it looks like the Ampera will indeed be built in the U.S.A., after European government denied to pay to play. At $59,000 MSRP, it probably won’t turn into a volume model real soon.

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What’s Wrong With This Picture: America’s Car Edition Fri, 16 Jul 2010 22:14:53 +0000

President Obama got a chance to check out the Chevy Volt yesterday, as part of his trip to the Michigan battery belt. Unfortunately, he did not confirm or deny whether the Volt will actually get 230 MPG, because the EPA and GM are still “negotiating” a mileage sticker for the Volt. Luckily, GM has provided an important look at how the Volt’s battery system stacks up against key competitors…

Yes, we’re pretty sure GM is bragging about how awesome its $40k (or, according to Time Magazine, possibly $32,500) Volt is compared to a $500-$900 Apple iPad. That’s a bit like Obama’s claim that billions in stimulus money will bring battery prices down to their current (Nissan Leaf) levels by 2015. C’mon guys, can’t we set the bar a little higher?

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Quote Of The Day: You Can Trust Your Dealership After All Edition Thu, 24 Jun 2010 19:11:43 +0000

Throughout the debate on Wall Street reform, I have urged members of the Senate to fight the efforts of special interests and their lobbyists to weaken consumer protections.  An amendment that the Senate will soon consider would do exactly that, undermining strong consumer protections with a special loophole for auto dealer-lenders.  This amendment would carve out a special exemption for these lenders that would allow them to inflate rates, insert hidden fees into the fine print of paperwork, and include expensive add-ons that catch purchasers by surprise.  This amendment guts provisions that empower consumers with clear information that allows them to make the financial decisions that work best for them and simply encourages misleading sales tactics that hurt American consumers. Unfortunately, countless families – particularly military families – have been the target of these deceptive practices.

This is what president Obama said just six weeks ago about efforts to exclude car dealership financing from consumer protection measures included in the forthcoming Financial Reform bill. With that bill moving towards Obama’s desk, all that stands in the way of its passage are angry dealers who don’t want to be subject to oversight. And despite the tough talk about standing up to financial interests to pass this reform, it seems Obama has caved to America’s auto dealers.

Today, the White House released a statement, reported by Automotive News [sub] that said

The president vowed to fight efforts to weaken this bill and find ways to strengthen it, which is why he opposes carve-outs like this one that would exempt auto-dealer lenders from new consumer protections. While we knew that we’d not win every fight, the president will soon sign into law historic Wall Street reform that includes the strongest consumer protections ever

So, why did Obama speak out against dealer finance’s exemption from oversight if he was willing to cave on it? That, so far, is a mystery. And though the bill does cover a number of important issues outside of the car industry, this is definitely the wrong message to be sending. With GM already looking to subprime loans for sales growth, the temptation to goose sales with ever-riskier and more-exploitative loans, whether on the dealer or OEM level, is undeniable. Sales have been flat since mid-2009, and in the established order of business for the car industry, financial trickery is the first resort of a struggling firm. And if the last two years have taught us anything, it’s that redlining sales with creative lending creates unsustainable growth. If Obama figures less regulation at the dealer level will boost overall sales, helping GM go private and him get re-elected, he’d better consider the possibility of another car sales crash in his second term. And in the meantime, anyone who gets screwed by an unscrupulous dealer will have their president to thank.

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Obama: Dealer Finance Must Be Regulated Wed, 12 May 2010 18:12:31 +0000 President Obama has weighed in on a crucial matter facing legislators attempting to overhaul America’s financial system: whether or not auto dealer finance should be subject to regulation by the new Consumer Protection Agency. Unsurprisingly, he has come down on the side of regulation, specifically echoing concerns voiced earlier by the Pentagon. The National Automobile Dealers Association has vowed to fight attempts to regulate dealer finance.

Statement by President Obama on Financial Reform
Throughout the debate on Wall Street reform, I have urged members of the Senate to fight the efforts of special interests and their lobbyists to weaken consumer protections.  An amendment that the Senate will soon consider would do exactly that, undermining strong consumer protections with a special loophole for auto dealer-lenders.  This amendment would carve out a special exemption for these lenders that would allow them to inflate rates, insert hidden fees into the fine print of paperwork, and include expensive add-ons that catch purchasers by surprise.  This amendment guts provisions that empower consumers with clear information that allows them to make the financial decisions that work best for them and simply encourages misleading sales tactics that hurt American consumers. Unfortunately, countless families – particularly military families – have been the target of these deceptive practices.

Claims by opponents of reform that this legislation unfairly targets auto dealers are simply mistaken.  The fact is, auto dealer-lenders make nearly 80 percent of the automobile loans in our country, and these lenders should be subject to the same standards as any local or community bank that provides loans.  Auto dealer-lenders offering transparent and fair financing products to their customers should welcome these reforms, which will make their competitors who don’t play by the rules compete on a level playing field.

We simply cannot let lobbyist-inspired loopholes and special carve-outs weaken real reform that will empower American families.  I urge the Senate to continue to defeat the efforts of special interests to weaken protections for all American consumers.

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Auto Bailout “Progress” Defined: “Only” $28b in TARP Losses Mon, 26 Apr 2010 17:00:05 +0000

Last week’s announcement that had Chrysler turned a Q1 profit and GM had “repaid” taxpayer loans brought a flurry of political posturing about the success or lack thereof of the auto bailout. With Republicans laying into the auto bailout from several angles, President Obama dedicated his weekly address to a defense of industry assistance. Obama still frames the bailout as an unpleasant necessity, but argues that last week’s news means the chances that taxpayers will recoup their “investment” are improving. And apparently the Treasury agrees. According to the Detroit News, Treasury has revised its estimate of auto bailout losses (not counting GMAC) downwards, from $30.6b to $28b. Progress, sure, but hardly a sign that taxpayers can expect full payback from its state-owned automakers.

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Obama Will Take Away Your Porsche Mon, 22 Feb 2010 19:16:21 +0000

In a few years, by 2016 to be exact, P.J. O’Rourke’s “ass-engined Nazi slot car” may be history in the U.S.A. Gone. By that time, Porsche needs to have a Corporate Average Fuel Economy (CAFE) of 41.4 mpg – if President Obama gets his wish. Mission impossible, says Porsche. Jack Baruth, stock up. Porsches will be extinct.

On May 19, 2009 President Barack Obama proposed a new national fuel economy program. If signed into law in May this year, as currently planned, the law will throw a nasty punch, beginning in the model year 2012.

Porsche-Lobbyist Stefan Schläfli talked to the German Edition of the Financial Times, before taking off for Washington for a last ditch effort to save the endangered species. Says the FTD: “Hardest hit will be German producers of premium brands which sell big-engined large cars. Critics in the German camp don’t think this is a coincidence. The formulas used to calculate the maximum permissible values are tailor-made for U.S. manufacturers. Basis for the calculation will be wheel base and track width – highly unusual criteria.”

A short and compact Porsche is faced with much stricter limits than a Corvette. Not to mention a pick-up. Large manufacturers turn into a CAFE-society, and can offset their thirsty oinkers with smaller cars. Porsche doesn’t have that option. Neither does Aston Martin, Jaguar,  Land Rover and other eclectic brands.

Being part of Volkswagen won’t help Porsche. According to the proposed law, Porsche would have had to be under Volkswagen’s umbrella in the year 2009. They weren’t.  The FTD reckons that Volkswagen may have to contend with problems of its own anyway. Strong U.S. sales of the Touareg, the Audi A8 or Q7 may make for very bitter CAFE.

To avoid immediate execution in 2012, Porsche received a stay in form of a special dispensation. The pardon expires in the 2016 model year.

Porsche (and many other makers, such as Mercedes) already pay for the thirst of their cars. Currently, the fee is a few hundred dollars per car, says the FTD.  The new law sets $37,500 as a maximum penalty – per car.  “We can’t afford that,” says Porsche’s  Schläfli.

Catching up with the new rules by 2016 would mean that Porsche has to improve their current average fleet economy of 27 mpg by 14.4 miles. “Technically impossible,” says Schläfli.

Unless the new CAFE law will fail at the last minute, the vehicular landscape in the U.S. will become quite boring in a few years.

Have any German or British Foreign Ministers complained, like Hillary Clinton  over 4200 American cars to Japan? Have European politicians proposed WTO action like Betty Sutton? Any trade wars threatened for the removal of Europe’s finest cars from American roads? Boycotts of Burger King?  Not a word. What’s with those Euros anyway?  Whimps.

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