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Tuesday, June 28, 2011

Could This Be The Sexiest Car On The Road?

Could This Be The Sexiest Car On The Road?

By Davif Kiley

The sexiest car on the road?

Could anything in the auto industry be more subjective? More open to argument?

Today's economic and political atmosphere would seem to dictate more discussions about cars that are fuel efficient and aerodynamic, or perhaps run on batteries, rather than those that are stacked with horsepower and sex appeal.

But consider that auto designers must work as much as five and six years in advance of when a car actually hits showrooms. New cars that are arriving at dealerships and auto shows this year were mere sketches on paper in 2006, well before the economic meltdown changed priorities for many consumers.

German automaker Audi is in the midst launching a new model in the U.S., the A7, with a marketing campaign that pushes the idea that the car, part of a modern design phenomenon known as the "four-door coupe," is worthy of being considered art. "The all-new Audi A7 takes cues from high art, with dramatic stylings and bold features, says Audi of America chief marketing officer Scott Keogh. "The A7 will join the ranks of icons in design and technology," Keogh added.

A TV and Internet video campaign for the A7 plays with the idea that a waiting public is so admiring of the A7 that people are busying themselves meticulously, cleaning, tidying and otherwise preparing roadways for the sexiest design ever.
The car does have its supporters for the title. "The A7 is like a sexy stiletto shoe that is also really comfortable," says Rebecaa Lindland, director of automotive research for North and South America as IHS Global Insight. "No question it is one of the most beautiful cars on the road." Lindland says she could argue the point for hours with people, and that her design standard until now has been the Porsche 911.

What is it about the car the elicits a comment like that, and makes Audi think it has the automotive equivalent of a "sexy beast" on its hands?
The A7 is, surprisingly, a hatchback. Long, and with a wide low stance, the lines are clan and classic. The hatch and cut-off rear end is reminiscent of an Italian super-car of the early 1970s. "This car is free of the gimmicks you'll find on many others in this class, and we haven't talked to anyone who doesn't admire its looks," wrote Car & Driver in its September 2010 issue.

"Sometimes you just know it when you see it," says design and marketing consultant Dennis Keene. "There is going to be a lot of argument in the coming years about this, but the A7 looks look a classic to me."

What are the others in its class? The first two that come to mind are the Mercedes-Benz CLS and the Porsche Panamera. The CLS was first launched in 2004 and ushered in a new segment in the luxury car market--the four-door coupe.

Traditionally, coupes are two door vehicles. But Mercedes saw a niche for people who wanted the personal space of a coupe with the practicality of a four door. The new car to enter to the fray was the Porsche Panamera, the first four door car the iconic German automaker had ever produced.

The starting price for the A7 is $59,250 and can climb to about $70,000 with all the features. The Mercedes CLS starts at $74,000. The Panamera starts at $74,400.

But while the A7 looks like a bit of a bargain compared with its German rivals, sometimes these arguments transcend money.

Monday, June 27, 2011

Saab thown lifeline by Chinese order for 600 cars

Saab thown lifeline by Chinese order for 600 cars

By Roland Gribben
A Chinese company has provided a lifeline for Saab Automobile with a cut-price order for almost 600 cars and enough cash to pay the wages of its 3,800 workers this month and make some payment to suppliers.

The unnamed buyer has made an advance payment of €13m (£11.5m) for 582 cars, offering the financially ailing Swedish carmaker more breathing space to raise the funds needed to keep the business on the road.

Last week the work force was told there was not enough money to pay wages. The order price works out at an average of £19,486 per car compared the current lowest price in Britain of £21,50-5 for a Saab 9-3 SE 2.0/t saloon

Saab was forced to halt production at its Trolhattan plant north of Gothenburg two months following a row with suppliers over unpaid bills. It has offered to pay suppliers 10pc of what they are owed to restart production and says it hopes to pay off all its debts by mid-September along with interest of 6pc to cover the delays.

Dutch-based owners, Swedish Automobile, formerly Spyker Cars, has been struggling to raise short-term funding while it presses regulators to speed up clearance for the sale of more than 50pc of the equity to two Chinese investors, Zhejiang Youngman Lotus Automobile and Pang Da Automobile to provide medium-term financing totalling €245m.

The long-running battle to save one of Sweden's prestige businesses and brand names has also seen the entire board, including employee representatives, of the Saab Automobile subsidiary, with the exception of Victor Muller, chief executive, resign.

Mr Muller said that while talks were under way with other potential investors to bolster short-term funding there could be no assurance that the discussions will be successful or that additional finance will be raised.

Swedish Automobile is also in talks with property groups over the sale and leaseback of the Trollhattan plant and other real estate interests while controversial Russian investor Vladimir Antonov continues to seek clearance for providing capital.

Friday, June 24, 2011

Gas-saving devices a waste of money

Gas-saving devices a waste of money
QUESTION: I am looking online at many gas-saving devices. They all make claims on substantial gas mileage increase. Have you tried any of these devises?

ANSWER: If any of these devices worked, the companies would give them out to automotive journalists to test and report on. Do not buy any of this junk – online or from infomercials.

QUESTION: I am interested the new Lexus CT200h. I have seen many TV commercials on this car and would like your opinion on this car.

ANSWER: I recently spent a week in this car, and I would say it is not a sports car but is an excellent four-person car that also has cargo room. Our test car drew attention every place it was parked. It seems the power of TV advertising works. The interior layout is very ergonomic for the driver. Every control is at the driver’s fingertips. Vision from every viewing point is unrestricted. Power is not what you would expect from a hybrid. 

There is a noticeable power increase in the sport mode. The car drives very smooth and there is no lack of power, fuel economy 43 city, 40 highway. Leather seats were very comfortable with multiple adjustments. The front heated seats were quick to heat. In the snowbelt area, heated seats are a must with leather. Our test car only had 800 miles and my average mileage was 38 mixed driving, sometimes aggressive. The car was also very quiet both on rough and smooth pavement. Bottom line, this is what you would expect from Lexus. Base price $30,900. As tested with premium audio, leather package, navigation, $36,725.

QUESTION: I am the original owner of a 2009 Sonata and no one but myself drives it. In late December 2010, I started having problems with “hard downshifting.” At first I thought it was my brakes, but shortly thereafter the problem stopped. Then in February 2011, it started again and got progressively worse. April 7, it was so bad that I thought for sure I would break down on the way home. When I looked online, I found that this appears to be a common problem with the 2009 Sonata. The service advisor at the Hyundai dealership told me that driving in the snow must have altered my driving pattern and the adaptive learning had to be reset. She said that this was a common problem and since I had 23,700 miles on the car, this was not covered under warranty and I would have to pay $107 for the service. She convinced me to also have the entire transmission serviced although I really had another 6,000-plus miles to go. Why would Hyundai make a car with this feature if driving in the snow can set it off? I live on Long Island, where it snows a lot. I am very disappointed and I sincerely think this is a design flaw and customers should not be responsible for paying any of the expenses. It’s bad enough to go through the angst and inconvenience without also being responsible for the repairs. Please respond.

ANSWER: Let’s first talk about a 1-year-old car with under 24,000 miles needing a reprogramming of the computer. I would protest to the max on this reprogramming, or erasing the memory. Why not just disconnect the battery for an hour? The changing of the transmission fluid is just drain out three to four quarts from the transmission drain plug just like changing the engine oil. I will say the transmission fluid must be the correct fluid. I can tell you there are a lot of other car brands, and something like this would make me look in other directions. Personally I am very disappointed that you had to pay for the reprogramming. As for the transmission fluid change, that is part of regular maintenance.

QUESTION: The engine light stayed on in my 2000 Cougar. The problem code was EGR valve – insufficient airflow. After replacing the EGR valve, the engine light again came back on with the same problem code. The EGR sensor was replaced. After that, the engine light again came on with DPFE failure code. Do you think replacing the DPFE will finally cure the problem or will this lead to a series of other sensor failures? On the other hand, do you think there is another remedy I am overlooking?

 ANSWER: Very seldom is it an EGR valve faulty. I see a lot of vehicles whose owners have replaced EGR valves and other sensors that are not the problem. EGR flow problems relate to carbon buildup and or faulty EGR related sensors such as the DPFE on Fords and VSV on Toyotas. Carbon buildup in EGR passageways, especially the intake manifold passageways. Just because there is a fault code does not mean the sensor is faulty. This is where a technician can pinpoint the actual problem. I would rather spend the correct labor time verse replacing unneeded parts.

Junior Damato writes weekly about cars. You can send questions to him care of the Old Colony Memorial, 182 Standish Ave., Plymouth, MA 02360.

Wednesday, June 22, 2011

Lamborghini Is Drop-Dead Sexy

First Lamborghini Aventador touches down on U.S. soil

The 2012 Lamborghini Aventador has officially arrived in the United States, and we're not sure if it arrived by boat or simply left the ground and flew across the Atlantic (it could do that, you know). Jordan Shiraki (ShirakiPhoto), working for Las Vegas Lamborghini and, was the lucky lensman who got to spend time with the newest angry bull. Shiraki scored the exclusive photo shoot, and we're happy to share the photos, which can be viewed the attached high-res image gallery.

We think Europe has had enough time to play with the car, and we look forward to more video and photography of the Aventador having fun here in the States. For now, Shiarki's shots will help satiate our Lambo desires.

2012 lamborghini  aventador in the las vegas desert

Tuesday, June 21, 2011

Expensive lemons: Used car prices to rise

Expensive lemons: Used car prices to rise
By Chris Isidore

Used car buyers are about to find that it's tougher to find the models they want. And they may have to pay more for older, higher mileage cars too.
Why? It's yet one more thing to blame on the crisis that hit the auto industry and overall economy in 2008.
A key supply of late model used cars -- vehicles coming off of three-year leases -- is about to be choked off due to the crisis in the financial markets and the auto industry that summer that cut deeply into new leases.
"Leasing fell off across the board in 2008, so there's just not going to be as many of those late model, good quality cars coming into the market," said Belinda Aborts, director of automotive credit for auto research firm Experian.
Car leasing plunged in the summer of 2008, tumbling by 58% between June and November of that year, according to research firm R.R. Polk & Co.
Doubts about the future of several automakers dried up the supply of financing needed to write new leases, forcing General Motors (GM,Fortune 500) and Chrysler Group to essentially stop leasing. Ford Motor (FFortune 500) cut back on leases too, as doubts about the residual values of leased vehicles changed the economics of that business.

Rusty cars that could be worth millions

The price of used cars has already been climbing in recent years. The Manheim used car price index, a key industry measure, hit a record high in May that is 30% above the low it hit in December 2008. And many believe there will be more pressure on prices as the pipeline dries up later this year.
"This summer could really be a problem," said Charlie Vogelheim, executive editor at Intellichoice, the car buying Web site run by Motor Trend Auto Group. "The demand will be building as the supply will continue to dwindle. You'll be surprised how close the used cars are going to get to new car prices."
Other experts say that new car prices will present somewhat of a cap on used car prices, preventing prices from shooting up too high. But new car prices have also firmed, lifted by a combination of tight supply since theJapanese earthquake and higher raw material costs.
Experts say that the availability of some used car models will be particularly tough to find later this summer, no matter the price.
"Even with gas near $4 a gallon, you could have trouble finding the truck or SUV you want because of the lack of supply from three years ago," said Alec Gutierrez, manager of vehicle valuation for Kelly Blue Book. "You're going to be finding higher miles than you would have expected, and you're going to have to pay a little more for that."
It may not be until late 2012 or 2013 before supplies start to come back to normal levels.
But while this may be bad news for anyone looking to buy a use car, people who have leases that are about to end could benefit from the lack of supply.
Sergio Stiberman, CEO of, said many dealers are offering deals to buy people out of leases early to try to replenish the supply of used vehicles.
Stiberman said many consumers with leases that are about to run out will be able to buy the vehicle at a price that was spelled out in their original contract, and then turn around and sell it or trade it in for more money. To top of page

Monday, June 20, 2011

Sirius XM Makes Huge Announcement In Used Car Segment

Sirius XM Makes Huge Announcement In Used Car Segment
The announcement made by Sirius XM Satellite Radio (NASDAQ:SIRI) is likely much bigger than their headline indicates, and much bigger than many investors even realize.This is not a "Certified Pre-Owned" deal, nor is it relegated to one brand. What Sirius XM announced was that more than 1,000 General Motors dealers will offer a three month promotional subscription on ANY satellite radio equipped used car sold REGARDLESS of brand.
One chief complaint of satellite radio investors for years has been finding a way to monetize the inactive radios already in cars, but no longer part of the subscription base. Deals giving certified pre-owned (CPO) buyers a promotional subscription have been in place for quite some time, but most used cars sold are not CPO cars. Thus, while there was a benefit to the company, Sirius XM was not seeing a massive influx of promotional subscriptions.
In a press release issued today the company stated:
Sirius XM Radio today announced that customers will automatically receive a 3-month subscription to SiriusXM when they purchase a pre-owned vehicle factory installed with satellite radio, regardless of manufacturer, from over 1,000 participating GM dealerships across the United States.
For the first time, participating GM dealers will provide customers purchasing non-GM pre-owned vehicles a 3-month subscription to SiriusXM. Customers purchasing Sirius or XM satellite radio-equipped pre-owned vehicles will have access to commercial-free music, and premier sports, news, talk, comedy and a selection of premium programming.
“Providing our pre-owned vehicle customers the very best value and buying experience is something we strive for everyday,” said Jason Brickl, CEO, Ballweg Family of Dealerships, and Co-Chair, General Motors National Dealer Council. “My dealerships have enrolled in the SiriusXM program and I encourage all GM dealers to sign up and take advantage of this opportunity to add value to their inventories and pass along this 3-month introductory subscription of satellite radio to their customers.”
“For the first time ever, participating GM dealers are able to give their pre-owned vehicle customers a 3-month subscription to SiriusXM regardless of vehicle brand,” said Joe Verbrugge, Senior Vice President and General Manager, Automotive Remarketing Division, SiriusXM. “GM dealers across the country are responding enthusiastically to this opportunity to give SiriusXM to their customers who won’t need to sacrifice innovative technologies or entertainment when buying a pre-owned vehicle.”
General Motors will continue to offer customers a 3-month subscription to SiriusXM with the purchase of new and Certified Pre-Owned Cadillac/Chevrolet/Buick/GMC vehicles that are factory equipped with SiriusXM.
This new type of deal will add a whole new dynamic to the Sirius XM subscriber picture. The used car market is HUGE, and there are millions of satellite radio equipped cars that are potential subscribers. This deal is big enough to throw a serious curve ball in analysts trying to count and gauge subscribers (depending on whether or not Sirius XM receives payment for these subscriptions). This type of deal could even grow to include brands like Ford in the near future.
If no payment is made for these subscriptions, these promotional trials will not be counted in the subscriber pool unless they become “self-paying” after the promotional period expires. What this will do is balance out the subscriber pool dynamic, and also help offset the poor sales seen by Japanese automakers due to the disaster in Japan.
Promotional subscriptions are divided into 3 categories, “LEADING”, “POINT-OF-SALE”, and “TRAILING”. Leading subscribers are counted when the company receives payment at the time a vehicle is manufactured. Point of Sale subscribers are counted when a vehicle is sold. Trailing promotions are only counted if a consumer elects to become self-paying after the promotion ends. To get an understanding of these categories, readers can refer to the SiriusBuzz monthly report on auto sales.
The ramifications here are huge, and SiriusBuzz will be taking a deeper look soon. Stay Tuned

Thursday, June 16, 2011

Mazda to announce new Mexico car plant Friday

Mazda Motor Corp is set to announce on Friday plans for a new factory in the central Mexican state of Guanajuato, a source familiar with the matter said.
The factory will be the fourth overseas assembly site for the Japanese automaker after the United States, China and Thailand -- all joint ventures with former top shareholder, Ford Motor Co .
Construction of the new plant in Mexico is set to begin this fall, with vehicle production to start in the second half of 2013, the source said on condition of anonymity because the information is not yet public.
Mazda plans to build compact cars, initially for sale in Mexico and South America, and eventually export to North America, the source said.
The investment is likely to be in the hundreds of millions of dollars, to be shared with trading company Sumitomo Corp , a second source said. The factory will have initial capacity to build at least 50,000 cars a year.
Mazda is set to make the announcement along with its financial forecasts for the business year to March 2012, due at 3 p.m. (0600 GMT) on Friday, the first source said.
Japanese automakers are under pressure to reduce exports as a strong yen makes it difficult to make money on exports, especially for smaller, lower-margin cars.
Mazda is especially vulnerable, producing more than two-thirds of its 1.277 million vehicles inJapan in the business year that ended in March. It shipped more than 80 percent of Japan-made cars overseas.
Mazda has said it was considering building a new assembly plant in an emerging market to meet growing demand but has not specified where. Last year, it posted record sales and market share in Mexico, which has attracted a growing number of investment deals from Japan, and the auto industry.
Mexico is now the ninth-biggest vehicle producer in the world, with a record 2.261 million vehicles produced in 2010, up 50 percent from 2009, according to the Mexican Automotive Industry Association.
Mexico's auto sector, a key driver of industrial activity, is closely tied to demand from the United States and it has helped the domestic economy rebound from a deep recession. (Reporting byChang-Ran Kim; Editing by Chris Gallagher)

Wednesday, June 15, 2011

eBay Find of the Day: 1965 Ford Mustang

eBay Find of the Day: 1965 Ford Mustang 

Intermeccanica may be best known today for producing its Roadster, a Porsche 356 replica. Years ago, however, the company built a handful of uniquely styled automobiles for a variety of customers. One of those customers was the J. Walter Thompson Advertising Agency, which commissioned a Ford Mustang station wagon to be shown off to Blue Oval brass. The Ford execs never went forward creating a Mustang wagon of their own, but a few other folks did. The one you see here was built by Joe Ramp, and you can put it in your garage because it's for sale.

Starting with a 1965 Mustang hardtop coupe, Ramp stretched out the roof and created custom rear side glass along with the fabricated D-pillars. The builder tried to retain as much as the stock body as possible, so the rest of the car is all Ford-built Mustang.

Builder Joe Ramp decided to upgrade the powertrain in order to better haul around the extra bit of weight. A 5.0-liter V8 sits underhood and is paired with a T5 five-speed manual gearbox. The power is routed to an eight-inch Ford rear-end and 3.00 gears. Custom control arms and upgraded shocks help the Mustang handle any cargo placed out back.

The car appears to be a clean example of what could have been. RK Motors of Charlotte, North Carolina has listed the car for sale on eBay, with a Buy It Now price of $59,990. Currently, the bidding sits at $15,100, with an unmet reserve. Take a look at the car in the gallery below, and click past the jump if you want to hear it running.

Tuesday, June 14, 2011

BMW Green Supercar arriving for 2012

BMW Green Supercar arriving for 2012
Unnamed for now, but BMW has plans to be releasing a “Green Super Car” for 2012. With inspiration from the M1 Homage concept and will be sporting a two-door, the BMW’s Efficient Dynamics system, the mid-engine supercar is rumored to be packing the twin-turbocharged 3.0-liter pushing out 300+HP. More info of this amazing car should be coming out soon.

Monday, June 13, 2011

Aren't dealers also jacking up the prices of used cars on their lots?

Scarcity pushes used car prices up
Even SUVs and pickups command top dollar from eager dealers
Written by

Tired of your car? Now may be the perfect time to get rid of it.

An economic recovery, however tepid, and a shortage of used cars means that dealers may offer top dollar for that clunker in your driveway.

Perhaps surprisingly, an odometer reading north of 100,000 is not a deal-breaker. But scratches and dents don't help.

Despite Delaware gas prices around $3.60 a gallon, even SUVs and pickup trucks are commanding higher prices.

According to data from the National Automobile Dealers Association, the average wholesale price of a used SUV is 11 percent more than it was just six months ago.

Small car prices are up between 21 percent and 31 percent, with the value of the tiniest models up the most.

The answer to why prices are surging is clear, according to economists and dealers. "Supply and demand," said Bill Willis, president of Willis Chevrolet in Smryna. "It's Economics 101."

During the recession, average new car sales per year fell from more than 16 million, to less than 11 million. Fewer new car sales meant fewer trade-ins, which has caused a shortage of used cars on dealers' lots, said Paul Taylor, NADA's chief economist.

That's even increased demand for types of cars that have typically been considered worthless on the market.

"At the auction, we're seeing higher-mileage cars," said Ray Nichols, owner of Bel Air, Md.-based BSC America, which operates auto auctions in Maryland and Florida, where dealers buy and sell cars.

"You used to never see a car with 150,000 200,000 miles," Nichols said. "But they're absolutely built better and last longer."

Consumers can look up their used car's value online at sites like, which is operated by NADA. Kelley Blue Book's site,, and are also helpful, experts say.

Taylor said high prices "should persist as long as the economy continues to grow." Manufacturers are squeezing incentives this summer to beef up profit margins.

Of course, a natural question may be, how much of a benefit are the higher prices for car consumers? Aren't dealers also jacking up the prices of used cars on their lots?

Taylor said yes, but suggests that deals might be found in new cars and leases.

According to the auto industry site, incentives for new cars -- such as cash back offers and ultra-low interest rates -- fell to their lowest level since 2005 last month. But, per car sold, incentives remain above $2,000.

That's helping close the cost spread between new and used cars, Taylor said.

Manufacturers are also looking to short-term leases as a tool to re-stock used car inventories for certified pre-owned programs, Taylor said.

Taylor said customers may get a good deal by cashing in their old car, and snapping up a new car on short-term lease.

"The interesting thing for customers is they have a much greater amount of trade equity than they might have had a year ago on the very same car or truck," Taylor said.

And with gas prices moderating, the value of trucks and SUVs, not just small cars, is likely to remain high for some time, Taylor added.

But, he said, "gas prices are much less a factor than this shortage of supply."

Friday, June 10, 2011

Mitsubishi Sees an Electrifying Future

Mitsubishi Sees an Electrifying Future

A week of billion dollar deals has injected new energy into the auto market's recovery and put the government well on the way toward its goal of producing 80 percent of cars sold in Russia domestically.
On Wednesday, Ford and local car producer Sollers signed an agreement to form a joint venture that could turn out 350,000 vehicles a year by 2015.
The two companies also signed a letter of intent for a 39 billion ruble ($1.4 billion) loan in financing from Vneshekonombank. Total investment is estimated to reach 74.5 billion rubles, according to the government, Bloomberg reported.
The deal followed the announcement last week that Italian carmaker Fiat — which Sollers had earlier jilted in favor of the Ford deal — will invest $1.1 billion to build 120,000 cars a year in Russia.
Meanwhile, Nissan and its partner Renault were reported to be planning to invest as much as $2 billion in Russia by 2015.
With local partner AvtoVAZ, the Russian market leader in which Renault has a 25 percent stake, the companies hope to increase their output to 1.6 million vehicles by 2015.
These are just three of 10 deals the Economic Development Ministry says it signed with foreign companies in the past week.
The investments were prompted by a recent adjustment to an incentive system under which the government offers waivers on import tariffs on parts in exchange for commitments to build a certain number of cars in Russia.
In a bid to reverse the damage done by the economic crisis, the government increased its requirements drastically at the beginning of 2011. To qualify for waivers, companies must now turn out 300,000 to 350,000 units per year by 2014 to 2015, build technical research centers and achieve 55 to 60 percent localization of parts.
Companies had until June 1 to present production plans to qualify for the perks. Others said to have taken up the challenge include GM and Volkswagen.
If they work out, the new deals could bring domestic car production to 2 million units per year by 2020 — 80 percent of today's market.
The Association of European Businesses estimates that 1.97 million cars and light vehicles were sold in Russia in 2010, and it projects sales of 2.5 million this year.
The market grew 60 percent year on year in the first five months of 2011, with sales of new vehicles up 48 percent year on year in May, AEB said Wednesday.
Imports of new cars were up 95 percent year on year to 365,200 in January to May, the economy ministry said Wednesday.
AEB has said the market could reach pre-crisis levels of 2.8 million to 2.9 million units by 2012.
But while the incentives may have served as a catalyst, analysts said the foreign car giants would not be sinking such huge sums into the country if it weren't in their interests.
"Russia is a big strategic market not yet fully developed. Every company that wants to increase its presence and share of local production here has to look to the long term," said Sergei Udalov of industry journal Avtostat. "That's why we're seeing such big numbers. These are not short- or medium-term investments."
But one company is gambling that, by that time, the car industry will be taking a wholly new direction.
Mitsubishi and its Russian distributor Rolf Import launched "experimental" sales of its iMiEV, a wholly electric car, at an event in Skolkovo on Thursday.
Unlike the much touted Yo-Mobile and other hybrids, the small five-door hatchback runs entirely on a battery that can be recharged at ordinary domestic power points or specialized charge points.
The Moscow energy company MOESK and a privately owned firm called Revolta are to set up an experimental network of 28 charge points around Moscow and the Moscow region in an 11-month pilot project.
The iMiEV has seen moderate success in Japan, the United States and some European countries, but its uptake has been heavily dependent on government assistance in the form of VAT and excise waivers, subsidies for customers and privileged road access for low-emission vehicles.
In the absence of such state support, the vehicle will initially retail in Russia for a prohibitive 1,799,000 rubles ($64,768), said Andrei Pankov, chief executive director of Rolf Import.
Pankov said 600,000 rubles of that was taken up by VAT, while the battery accounts for 50 percent of the initial cost of the vehicle — both of which should drop if the state legislates and technology improves.
"In the 1990s no one could imagine how cheap and normal charging mobile phones or laptops would become. We're in exactly the same situation with electric vehicles," Pankov said. "This is the car of the future."
The first batch of iMiEVs destined for Russia will roll off production lines in Japan in July.
Mitsubishi is not among the firms pledging to meet the 350,000-unit threshold, although it does plan to up production at its Kaluga plant from 9,000 this year to 20,000 in 2011, Mitsubishi Russia general director Shin Fujioka told The Moscow Times on Thursday.
General Motors is considering putting Opel up for sale again as management is losing confidence that the European arm will return to profitability, two German magazines reported, according to Reuters. 
Auto Bild and Spiegel Online reported Thursday, without citing any sources, that possible buyers could be Chinese carmakers or Germany's Volkswagen, which has almost 20 billion euros ($29.3 billion) available to spend. 
In late 2009 General Motors abruptly ended negotiations on the sale of Opel to a consortium of Canadian car parts maker Magna and Russia's Sberbank
At the time, Prime Minister Vladimir Putin personally supported the bid, saying the Opel deal "should be incorporated into the strategy" to develop domestic carmakers.

Monday, June 6, 2011

Is the Electric Car Finally Here?

Is the Electric Car Finally Here?
By Steven Cohen

Because of America's decentralized pattern of residential development, this country will always be heavily dependent on personal rather than mass transportation. While I am lucky enough to live in Manhattan and do not need a car to get to work or for daily use, most people in this country drive everywhere. Over the next several decades we will see the revival of some towns and cities and some additional development of mass transit, but in this country the auto is here to stay. To reduce both costs and the pollution generated from motor vehicles, we will eventually turn to electric cars. Hopefully, these cars will be powered by electricity generated from renewable sources of energy. Electric cars may seem like a vision of the future, but clearly, a great deal of progress has been made in the past few years to make this vision real. The arrival of the Nissan Leaf, an all-electric car designed for the mass American market, is a sign that the electric car may finally have arrived.

Recently, Bill Marsh of the New York Times compared the cost of a hundred miles of driving in a Nissan Altima to an electric powered Nisan Leaf. The Leaf cost $2.64 for fuel compared to $14.25 for the Altima, and its power needs generated 63.6 pounds of greenhouse gasses compared to 90.5 for the Altima. It's true that electric car owners face the inconvenience of charging the car, and the fear that they could end up on the side of the road without juice for the battery. Still, the electric car seems to have crossed the cost threshold and is closer than ever to becoming a real option.
Last semester, students I worked with in Columbia University's Masters of Public Administration Program in Environmental Science and Policy conducted an analysis of the feasibility of electric cars in New York City for the Mayor's Office Long Term Planning and Sustainability. While enhancing mass transit is the main method employed by the city to reduce the energy used and greenhouse gasses emitted from transit, most people in New York City live outside of Manhattan and are nearly as dependent on the auto as folks living in the rest of this country. For these New Yorkers, the electric car may be an important way to improve their transportation sustainability. In examining the issues of electric car implementation in New York City, my students observed that:
"...the City faces unique barriers that may prevent its widespread adoption. Auto-manufacturers market electric vehicles to homeowners with access to personal garages and driveways for recharging, but nearly half of New York City drivers depend on street parking. Additionally, New York City's electricity rates are among the highest in the nation, reducing the savings offered by an electric vehicle."

To address these problems, they proposed that New York's electric utility, Con Ed, adopt and promote a lower evening rate for charging cars and that the city's government look into the feasibility of establishing or encouraging commercial charging facilities in neighborhoods where homes lack private garages.
It is possible that the issue of charging batteries may soon be solved technologically. As battery technology advances, it may someday be possible to simply drive into a convenience store and drop off a used up battery and pick up a charged one to replace it. While that type of battery technology is still being developed, when it is in place, the fear of running out of juice will be eliminated. Shai Agassi, an Israeli entrepreneur, has begun implementing such a system in Israel. This past May, his company, A Better Place, introduced the Renault Fluence ZE, the first all-electric car offered for sale in Israel. One of the most interesting elements of Agassi's business model for the electric car is the way his company approaches the pricing fuel. As Agassi recently wrote in the Atlantic:
"Why then have we not seen the market tip toward the electric car? Because the acquisition cost of the car plus the battery is still too high for most consumers and the lack of wide spread infrastructure means the range of an electric car with a bolted battery inside is not enough to satisfy most drivers accustomed to refueling once a week, every 300 miles. At Better Place, our answer to this challenge lies with the infrastructure, not the battery. By separating the ownership of the car and the battery and providing consumers with the network and infrastructure to conveniently charge the battery when parked -or switch the battery in less time than it takes to refuel on longer drives - convenience is attained. Price the car without the battery at purchase, and the rest as you drive and the electric car enjoys the same buying model as a gasoline car - and the electric car proves cheaper today and progressively cheaper to own and operate with time. As an electric car is mostly a consumer electronic device, we know the trend line on its cost, much like we know where oil is headed. They are headed in opposite directions in favor of electrons."

Businesses and governments are beginning to view this new technology as a practical reality. The pace that electric car technology is adopted and gains acceptance will in part be a function of its reliability and cost. These factors will be influenced by public policy. The diffusion of new technologies into a society and economy is very difficult to predict. For example, who would have guessed that there would be 5 billion cell phones on the planet by 2011? Similarly, who would have thought that we all needed to carry around 3,000 songs in our pockets at all times?

There is enough petroleum on the planet to power our cars for another century, so why switch from gasoline to electricity? Maybe for the same reason the horseless carriage replaced the horse and buggy: It was more convenient, less expensive, and didn't leave the streets ankle deep in manure. The electric car is cheaper and cleaner to run than the gasoline powered car. As Agassi indicates, this price distinction will become greater in the future. The question for the electric car may be - when? Not if. The issue is how long will it take to overcome the momentum of sunk costs and old habits? Perhaps the cell phone provides a good model. Ask young people if they ever plan to own a land line phone. Look at the declining price per minute of phone time, and the increased use of phones, text messages and e-mail. These changes have been quite rapid and were not predicted by anyone. While an auto is far more expensive than a phone, and represents a major household investment, people seem open to new thinking about cars. I suspect that the transition to electric vehicles will happen suddenly and unpredictably; perhaps sooner than we think.