General Motors Co. said Wednesday it would shut down its Saturn brand after an agreement with Penske Automotive Group Inc. to acquire it fell apart.
Penske, citing concerns of whether it could continue to supply vehicles after a manufacturing contract with GM ran out, ended talks with GM Wednesday to acquire the brand.
GM CEO Fritz Henderson said in statement that Saturn and its dealership network will be phased out.
“This is very disappointing news and comes after months of hard work by hundreds of dedicated employees and Saturn retailers who tried to make the new Saturn a reality,” Henderson said in a written statement. “PAG’s announcement explained that their decision was not based on interactions with GM or Saturn retailers.”
In a statement, the Bloomfield Hills, Mich.-based auto retailer says an agreement with another manufacturer to continue producing Saturn vehicles after GM stopped making them fell through, leading Penske to terminate talks with GM.
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Penske said it negotiated terms and conditions to make Saturn cars with another manufacturer, but that company’s board of directors rejected the agreement. Penske spokesman Anthony Pordon would not identify the other manufacturer.
“Without that agreement, the company has determined that the risks and uncertainties related to the availability of future products prohibit the company from moving forward with this transaction,” the company said in a statement.
In June, GM and Penske agreed to take over the Saturn brand and related dealerships, although GM would produce the vehicles for a limited period of time.
GM said Saturn vehicle owners can still go to their Saturn dealer for service and would be able to go to a certified GM dealer for service once Saturn dealerships are closed.
It was expected that GM would announce the completion of Saturn’s sale to Penske in the coming days.
Share of Penske fell $1.93 to $17.25 in after hours trading. They rose $1.32, or 7.4 percent to $19.18 in regular trading Wednesday.
Copyright 2009 The Associated Press. All rights reserved.Read More
Carmakers fight hike in ethanol at pump
They want research on engine effects before boosting ratio in fuel
Detroit News Washington Bureau
Washington — A push by corn-producing states and alternative fuel proponents to increase federal rules boosting the amount of ethanol mixed into gasoline is being fought by automakers because it would be costly and could damage engines.
By Dec. 1, the Environmental Protection Agency must decide whether to approve a request to increase the amount of ethanol that can be mixed with most gasoline sold at pumps to as much as 15 percent.
Most pumps already sell E10, which is 10 percent ethanol.
Automakers want the agency to further study the effects of the proposed increase before allowing it to happen.
Increased ethanol blends could corrode engines that aren’t specifically built for E15, according to automakers.
Four farm state senators led by Ben Nelson, D-Neb., introduced a measure that would require the EPA to grant the request.
More than 13,000 people and groups have written the EPA since the request was filed in March.
Congress has required that the nation use 11 billion gallons of ethanol next year and 36 billion gallons by 2022.
Mike Stanton, CEO of the Association of International Automobile Manufacturers, the trade group representing major foreign automakers, noted the United States would not be able to consume even half of the ethanol required by Congress by 2022 by simply requiring all pumps to be E10.
“We’re on a collision course here,” he said.
And there are a number of problems with an immediate boost in the ethanol blend.
Automakers warn the higher ethanol blend could boost greenhouse gas emissions, damage engines or disable vehicles.
In Baltimore, nearly a third of the city’s patrol cars stopped running earlier this month because a station had boosted the amount of ethanol in the fuel. It isn’t clear how much ethanol was in the mix.
Stanton, and Dave McCurdy of the Alliance of Automobile Manufacturers, which includes Detroit’s Big Three, Toyota and seven other automakers, wrote a letter Friday to Congress urging more research before approving ethanol blends like E12 or E15.
That idea “is premature, and since EPA has never allowed conventional vehicles to use higher ethanol blends, the research on their potential impacts on vehicles not designed, tested or warranted for their use is incomplete,” the letter said.
The adoption of E15 could also affect users of other gasoline engines.
The International Snowmobile Manufacturers Association, based in Haslett, warned in comments to the EPA that the increase could do “irreparable harm” to the nation’s more than 1.8 million registered snowmobiles and damage the economy of Michigan and other northern U.S. states that rely on snowmobiling for tourism.
Associations representing the nation’s 80 million boaters have also opposed the request, saying it could damage marine engines.
In 2007, Congress required the nation to drastically boost the amount of ethanol it uses to 11.1 billion gallons this year, nearly 60 percent more than what the United States used in 2007, and more than 2 billion gallons over 2008. Nearly all of the U.S. ethanol is now corn-based, but research and investment into the commercialization of cellulosic ethanol could lead to production from renewable sources like grass or wood chips. No significant quantities of cellulosic ethanol have been produced.
Ethanol producers point to some studies that suggest higher blends wouldn’t harm most engines. The EPA first approved the use of ethanol blends of up to 10 percent in 1978.
Congress asked to fund tests
Automakers have joined with the oil, ethanol, small engine, marine, outdoor power equipment and motorcycle industries to create a task force, along with the Energy Department and EPA, to assess different blends.
Dubbed the “midlevel ethanol blends research coordination council,” the group says Congress needs to allocate money to fund testing.
The automakers wrote Congress on Friday asking it to set aside $17 million “to complete the necessary vehicle testing.”
Congress is also considering whether to force automakers to build more cars that run on nearly all ethanol.
The auto industry has produced 7 million vehicles that can run on E85, a blend of 85 percent ethanol, or on regular gasoline. A bill in Congress sponsored by Sen. Sam Brownback, R-Kan., would require automakers to produce 50 percent of their fleet as E85-compatible by 2012 and 80 percent by 2015. A House version is sponsored by Rep. Eliot Engel, D-N.Y.
In March 2006, Detroit’s Big Three agreed to build 50 percent of their vehicles as flex-fuel vehicles by 2012 under certain conditions. Automakers get credits toward meeting fuel efficiency regulations for building the vehicles.
Under EPA’s recently proposed tailpipe emissions limits, it would continue the flex-fuel vehicle credit through the 2015 model year. After that, automakers would get the credit only if they could show that the fuel was being used.
The Union of Concerned Scientists urged EPA to “reject the E15 petition as a premature, unnecessarily piecemeal approach.”
Low gas prices hurt ethanol
Many ethanol producers are struggling because motorists consider gasoline prices around $2.50 a gallon affordable, and are not clamoring for a cheaper fuel. E85 is averaging about $2.01 a gallon, but it’s about 25 percent less energy intensive, so its price per mile cost is currently virtually identical to gasoline.
In May, the Obama administration created a task force to help the ethanol industry.
The $787 billion federal stimulus package sets aside $786.5 million to accelerate biofuels research and boost commercialization by providing additional funding for commercial biorefineries.
The new funds include $480 million for pilot- and demonstration-scale biorefineries, $176.5 million for commercial-scale biorefinery projects and $130 million for research.
Proponents of ethanol say the industry provides American jobs — especially in rural areas — lessens the nation’s dependence on foreign oil and provides a steady income for farmers. Michigan has five ethanol refineries.
Iowa and South Dakota’s agriculture secretaries wrote the EPA urging the increase.
“In 2007 alone, the ethanol industry created more than 200,000 American jobs that cannot be exported or outsourced, while contributing $47.6 billion to our (gross domestic product) and generating $4.6 billion in tax revenues,” wrote South Dakota’s Bill Even and Iowa’s Bill Northey.
But using large amounts of the nation’s corn boosts food and feed prices, critics say.
Last year, Texas Gov. Rick Perry unsuccessfully sought to water down the mandate, citing high feed prices.
The National Cattlemen’s Beef Association said in opposing the 15 percent blend that it “would require an immediate 4.5 billion gallons of ethanol, and would require approximately 1.6 billion bushels of corn — which is nearly equivalent to the amount of corn used by the cattle industry in an entire year.”
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© Copyright 2009 The Detroit News. All rights reserved.
With Chinese tires, it’s buyer beware
Amid trade tiff over Chinese tire imports, some concerns about quality
By Dan Carney
updated 6:09 a.m. CT, Thurs., Sept . 24, 2009
The United States and China are battling over trade tariffs on tires, but for most of us, safety is where the rubber meets the road.
Imports of Chinese tires have grown from 15 million tires in 2000 to 46 million last year, according to the United Steelworkers union, which has accused China of unfair trade practices. The union, which represents workers in the rubber industry, said Chinese tires imports have accelerated this year, with August imports up 57 percent over January levels based on the weight of tires unloaded on U.S. docks.
President Barack Obama this month backed the union’s position and ordered higher tariffs on Chinese tires in an effort to slow the flood of imports that unions blame for thousands of U.S. jobs lost. Obama met with China’s President Hu Jintao Tuesday to discuss trade, among other issues, as world leaders gathered at the United Nations for the General Assembly meeting.
For many drivers, the trade spat might raise the question of how safe are tires imported from China, given that country’s poor safety record on other products including toothpaste, pet food, toys and drywall.
The answer depends on whether you buy Chinese-made tires from name brands like Goodyear or Michelin, vs. Chinese-label tires or those made in China under contract for some private store labels, tests show.
Tire manufacturers, many of which have moved some production to China to save money, say that production techniques and materials are the same no matter where the tires are made, and that their Chinese tires are every bit as good as those made elsewhere in the world.
“The Chinese tires coming into this country for the most part have been safe tires,” said Roy Littlefield, executive vice president of the Tire Industry Association. “All the tires have to be tested before they come here,” he said, referring to U.S. government testing and standards.
“We have same global quality standards around the world,” said Keith Price, a spokesman for Goodyear Tire and Rubber Co. “The standards are the same whether we make it in Oklahoma, Germany, Brazil, Indonesia, or China, the product standards are the same.”
Jim Smith, editor of Tire Review, a trade magazine, said he has seen this for himself.
“Michelin is very persnickety,” he said. “At the Chinese plant you couldn’t tell if you were in China or in South Carolina. The plant has the same controls, the same machines and the same uniforms on the workers.”
Nevertheless, there have been some safety blips in Chinese-made tires.
Last year the National Highway Traffic Safety Administration launched an investigation into defective tire valve stems produced by a subsidiary of Shanghai Baolong Automotive Corp. The company sold 300 million valve stems which were susceptible to cracking, potentially causing the tire to deflate, a problem which led to one fatality, according to NHTSA.
Two fatalities were attributed to defective tires made by Hangzhou Zhongce Rubber Co. because of tread separation. The tire importer issued a recall for the 450,000 tires it had sold.
The average consumer thinks little more of tires other than that they are “round and black” said Matt Edmonds, vice president of marketing for mail order giant Tire Rack, so when shopping for tires, country of origin probably takes a back seat to other factors such as price, buyer loyalty and reputation.
But with tires, as with many other products, it’s buyer beware — you get what you pay for.
Because of the substantial differences between name-brand tires that are made in China and tires that are designed and manufactured by Chinese tire makers, it may be more relevant to consider Chinese tires as two separate products.
Consumer Reports magazine tested 23 affordable all-season replacement tires, seven of them made in China, reported Gene Petersen, tire program leader for the magazine. Of those seven, six finished in the top half of the field, he noted.
They included tires from brands such as Toyo, Cooper, Pirelli, and Kumho. “Because these tires are being built with the companies whose names are on the tires, the same specifications that would apply to a tire made in the U.S. would apply to a tire made in China,” said Petersen.
But that was seemingly not the case for the Chinese-branded Ling Long tires tested by Car and Driver magazine. The Ling Longs wore a tread pattern identical to that of a popular Yokohama tire, a visible semblance that could cause consumers to assume similarity of performance.
That assumption would be wrong. The magazine found the braking distances and cornering grip were much worse for the Ling Long tires than for any others in the test, requiring an extra 22 feet — one and a half car lengths — to stop from 50 mph than the best tires.
“Chinese-branded tires are a whole different world,” reported Car and Driver technical director Dave VanderWerp. “You absolutely get what you pay for, which, as we found in our test, is capability that is nothing short of scary. The Ling Longs in our test scored less than half the performance-based points than even the next-best, eighth-place tire. That’s how far they are off the pace.”
“Is a Ling Long tire as good as a Michelin?” asked Smith. “No. If you want a Michelin, buy a Michelin,” he said. “It depends on the consumer and what they are willing to pay.”
There is no way to predict whether Chinese-branded tires will prove to be safe for American drivers, but because they are built to pass U.S. government safety tests, they should be.
But in the question of safety and performance in real-world driving conditions, Chinese tires will have to prove their worth to convince consumers. “It is more than the tread pattern, it is the engineering that goes into the tire,” that determines its performance characteristics, said Edmonds, of Tire Rack.
Unfortunately, because these tires target the price-sensitive low end of the market, customers might be more swayed by the price tag than by the potential for longer braking distances.
“I’d sure like it if the guy behind me can stop another 20 feet shorter in the rain,” said Edmonds.
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Take a look at this video. Next time you pull up to a Mini Cooper in your ZR1 make sure you remember watching this.Read More
On the show last week, I went on a rant about not liking the all-new Prius. As with most things I say on the air, time should be taken later to reflect. Now is a good time for reflection.
I don’t get the Prius. Nope. Not at all. It’s slab-sided styling and Spartan interior do little for the “car guy” in me. I’m all for the green movement, just don’t take away my passion to do it. At one time on the show I mentioned that everyone should own at least one hybrid. I still feel that way. After driving several Hybrids the last few years I’ve come to have an appreciation for the good ones. I especially enjoyed the GMC Sierra Hybrid. It does everything you want a truck to do, it just saves fuel while you do it.
So, maybe that’s the deal with the Prius. It does everything most people want a car to do. Start, run, drive, stop and turn. I forget sometimes that all the world does not look at cars the way my friends and I do. They are, after all, all about getting from A to B. No matter how you look doing it.
But, there is a cult following for this car. One listener was so mad regarding my opinion of the car he felt compelled to waste his time telling me about it. I get it. You like your Prius. Simmer down, cowboy. I like my dog but, I understand if you don’t. In many ways, I think people buy this car for many of the same reasons they buy high-end sport-yutes and Porsche’s. It’s a, hey look at me, I’m greener than you thing.
The truth is, however, this car performs very well in the fuel economy department. My wife averaged well over the estimated 50 mpg. Actually, it was closer to 60mpg. I’m sorry. That’s nothing to take lightly. I saw a picture on the web of a Prius doing 102 mph and registering 26 mpg. That’s impressive. But, for you performance guys and girls who may be interested in the all new Prius, the top speed is a computer controlled 112 mph. The new 1.8 liter motor is a huge step up in performance.
Since we all know what the exterior has to offer I’ll spend a minute on the interior. Why isn’t the shifter connected to anything. Also, why isn’t the Prius more tech-savvy? The competition is ahead in many areas. Like Ford’s sync system. The seats are supportive and offer a good comfortable driving experience but, the material feel is bland.
Over all, I guess the Prius would be a very good choice for the economy minded who wish for others to know what they are doing to help the environment.Read More