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Five Thoughts about the Auto Industry for June 3, 2011

June 3, 2011 – 5:25 pm

The first Friday in June is here, and with it my five thoughts about the auto industry for the past week.

1 – Cadillac Cancels Electric Cadillac SRX Crossover

Perhaps the most surprising thing about the Chevrolet Volt electric vehicle is how restrained GM has been about porting the platform to other brands within its portfolio.  This restraint continues with the news that the Cadillac SRX crossover will not be gaining an electric drivetrain based on technology lifted from the Volt.  As I wrote in my Autotropolis article, costs were the main reason for the death of the SRX EV, combined with the fact that the battery-powered crossover would have made it to market with only one or two years remaining in the vehicle’s life cycle.

2 – Volt Tax Credits Pilfered?

In further Chevrolet Volt news, the National Legal and Policy Center has published a report that accuses Chevrolet dealerships of selling Volt sedans to each other, pocketing the federal tax credit associated with battery-powered automobiles and then re-selling those credit-less examples to hapless retail customers as “used” automobiles.  The discovery of this potential misuse of the U.S. Governments tax credit program came after the group investigated the legitimacy of GM’s claims of strong demand for the automobile.  What the NLPC found was a maze of ultra-low mileage “used” Volts being sold around the country by a large number of dealerships that had already applied for the federal eco-credit.

3 – Future Full-Size GM SUVs To Be More Expensive

With new platforms on the way to replace the GMC Yukon, Chevrolet Tahoe, Chevrolet Suburban and the Cadillac Escalade, GM is sprucing up its SUV plant and potentially passing on the costs associated with building more fuel efficient vehicles that meet federal regulations directly to the consumer.  Look for pricier large sport-utility vehicles from General Motors by 2014 at the latest.

4 – Three-Cylinder Cars Make A Comeback?

It’s been a long time, and most people’s memories of the Pontiac Firefly and Geo Metro have faded into obscurity.  While smart currently offers a three-cylinder motor in its low-volume fortwo coupe and cabriolet, no other major automaker has dropped below the four-cylinder limit in North America – until now.  Ford has announced that it will be building a 1.0-liter, three-cylinder EcoBoost motor that will be paired with an eight-speed automatic transmission and used in its subcompact automobiles around the world.  The engine is expected to replace the four-cylinder unit currently used in the Ford Fiesta.

5 – More Fuel Fears Give Us The Seven-Speed Manual Transmission

Although eight-speed automatics are now old hat, the manual tranny has been stuck at six cogs for what seems like more than a decade.  That is about to change thanks to Porsche’s decision to install a seven-speed manual in the next-generation Porsche 911.  The reason?  Adding a taller gear at the top of the shift pattern will allow Porsche to preserve the 911’s performance character while also benefiting from better fuel mileage.

How long before this technology trickles down to more affordable cars, where a fresh batch of teenagers will be even more baffled by their inability to find reverse?  Probably never – manual transmissions in North America are an endangered species, which is part of the reason why investment in their development has historically been so low.  The real miles-per-gallon savings are found in automatics, and with CAFE regulations creeping ever upward, autos will undoubtedly snag an even larger percentage of dealer inventory.

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