A Tale of Two Directions: Ford Reports Record Losses and Exxon Reports Record Profits

Ford has released their P&L statement for 2008 and it is Unpretty, as TLC would say. They have closed the books on a brutal year that saw the company lose a record $14.6 billion. It took Ford 105 years to get to this point. At this rate, Ford will have to ask for government assistance to get through these abysmal economic times. The real question is, "Does Ford have a plan that will help them succeed in these difficult times and ride out the storm?" Are they going to be able to survive and bring to market vehicles that the public wants? They do have a great product in the Ford Fusion so hopefully the auto icon will make it.

Now, let's look at the flip side of this coin, namely the big oil company, Exxon Mobil. Because of the outrageous gas and oil prices we saw in the spring and summer of last year, Exxon was able to post record profits, to the tune of $45.2 billion. These numbers are hard to comprehend and can only be dwarfed by the US Government and their economic stimulus packages and banking bailouts. What will these big oil companies do if the automakers fail? Isn't it in their best interest to see major auto manufacturer's succeed?

Here's a good idea; Let's have Big Oil donate half of their enormous profits directly to the auto manufacturers. This way, the US citizen does not have to bear the brunt of the bailout and the oil companies can do something constructive with their profits.

What will Exxon Mobil do with all their extra cash? Are they going to help with research of alternative energy or will they continue looking for more ways to rape the earth in search of that last drop of oil? I am betting on the latter.

The 2010 Ford Fusion $3400 Tax Credit

Are you in the market for a new hybrid car? According to the sales figures, you are in the minority! Nevertheless, the Ford Fusion is a great product offering from Ford that is a hybrid-electric vehicle offering outstanding city mileages. The Fusion will average about 41 mpg in city driving which is a significant improvement over most sedans, which usually come in at less than 25 mpg.

Get to your dealer before March 31, 2009 in order to qualify for the full rebate. I would be interested in this vehicle except for one thing, there is no plug. I want the option of all electric operation and the ability to use my electricity for recharging.

From Green Car Congress:

Buyers of a new 2010 Fusion Hybrid or Mercury Milan Hybrid this year will qualify for a $3,400 tax credit.

The credit amount is based on a vehicle’s potential fuel efficiency. The Fusion Hybrid carries a 41 mpg rating in the city and 36 mpg on the highway.

Fusion Hybrid travels up to 47 mph in pure electric mode, faster than all other hybrids currently on the road. In addition, the system’s Intake Variable Cam Timing (i-VCT) allows the hybrid to more seamlessly transition from gas to electric mode and vice-versa, delivering a near imperceptible hybrid driving experience to the customer.

The 2009 Escape and Mariner Hybrid FWD models qualify for a $3,000 tax credit; 4WD models $1,950. Owners of previous model-year Escape and Mariner hybrid models may also qualify for varying credit amounts from $1,950 to $3,000. The credit is only available to the original purchaser of a new, qualifying vehicle.

Ford Hybrid Tax Credit Amounts
Vehicle	1 Jan 09 to 3 Mar 09	1 Apr 09 to 30 Sep 09	1 Oct 09 to 31 Mar 10	1 April 10 and later
2010 Fusion and Milan Hybrids	$3,400	$1,700	$850	$0
2009 Escape and Mariner FWD Hybrids	$3,000	$1,500	$750	$0
2009 Escape and Mariner 4WD Hybrids	$1,950	$975	$487.50	$0

Customers who purchase a Ford or Mercury brand hybrid by March 31, 2009 will remain eligible for the full tax credit amounts. Beginning April 1, 2009 customers who purchase a hybrid will only be able to claim a partial tax credit.

Since Ford Motor Company reached the 60,000 vehicle threshold in the 4^th quarter of 2008, the tax credit amounts are reduced by 50% beginning in the second quarter of 2009 and by an additional 25% beginning in the fourth quarter of 2009.

Super Bowl Ads This Year Without Detroit Three

You gotta realize that times are tough indeed when the three major US Automakers eschew advertising opportunities during the Super Bowl. Alas, this will be the case this year as all three have decided not to pony up the $2.8 to $3 million dollar per 30 second fees that NBC is commanding. Maybe the Big Three are serious finally about cutting costs and streamlining their businesses? Then again, maybe all three are nearly ready to go belly up and Super Bowl ads are not going to help at this point!

Instead of GM, Ford and Chrysler ads, we will get to watch Hyundai, Audi and Toyota commercials. Yawn. All three have ads in the first half, which is a good time to place your bet in case the game gets too lopsided. Also advertising this year once again is Cars.com. Apparently, they are going to show us how Internet noobies can find the relative ease with which to navigate their website. Wow, I will be riveted, to be sure.

Does it matter if US Automakers sell their wares during the Big Show? I think what matters is how funny the beer commercials are, wouldn't you agree?

Ford is Blowing Through Cash Like There is No Tomorrow

The Ford Motor Company has some great products on the horizon that can make a huge difference in the auto industry. The question is, "Will they last long enough to get them to market?" In the fourth quarter alone, they burned up $5.5 billion. They have not been profitable for years and they are nearing the end of their cash reserves. How can they possibly survive without government aid? I have no idea, how about you?

From Automotive News:

Ford Motor Co., the only U.S. automaker operating without federal loans, burned through $5.5 billion in cash during the final three months of 2008 as losses mounted.

Ford finished the year with cash reserves of $13.4 billion. The company said it is drawing down $10.1 billion in available credit lines immediately because of concerns about unstable capital markets and the uncertain economy.

Ford reported a net loss of $5.9 billion for the fourth quarter, compared with a loss of $2.8 billion a year earlier, capping its third straight year without a profit. The pretax operating loss, excluding special items, was $3.7 billion, compared with a loss of $620 million during the same period in 2007.

"Ford and the entire auto industry faced an extraordinary slowdown in all major global markets in the fourth quarter that clearly had an impact on our results," CEO Alan Mulally said in a statement.

Some analysts say Ford needs at least $10 billion on hand to run its operations. At the fourth-quarter cash burn rate of $1.83 billion a month and not considering other steps, Ford was on a pace to cross that threshold by the end of February.

CFO Lewis Booth said today that won't be the case, because the company's expects to deplete its cash reserves more slowly this year.

"We look at our burn rate every day, Booth said. "We are confident that our burn rate will substantially slow in 2009, including in the first quarter."

Adequate liquidity

Ford said it has adequate liquidity and is taking steps to bolster it, including the conversion of a temporary asset account with the UAW. Discounting any cash used during January, the company's cash reserves now stand at about $26 billion.

"We are not drawing the revolver to fund operations; we are not drawing the revolver to stay above mininimum cash levels," Booth said. "We're drawing it because we think it's the prudent thing to do given the uncertainty of the financial markets."

Ford's revenue plunged 36 percent to $29.2 billion during the fourth quarter as U.S. auto sales dropped to quarter-century lows amid the longest recession since the early 1980s.

In December, Ford told Congress it doesn't plan to post a profit or break even on its worldwide or North American auto business until 2011.

Ford burned less cash in the fourth quarter than it did in the July-September period, when it went through $7.7 billion. Ford finished the third quarter with $18.9 billion in gross cash.

Ford had $10.7 billion in available credit lines at the end of the third quarter. That number was reduced to $10.6 billion when one credit line expired and wasn't renewed. The remaining $500 million in available credit is already pledged, but not drawn.

In December, Ford asked Congress for a $9 billion credit line, but said it would only need to use it if the economy worsens.

The $10.1 billion Ford is drawing today should arrive in company accounts by Tuesday.

Annual loss

Ford's full-year net loss was $14.6 billion, compared with $2.7 billion in 2007. The annual operating loss widened to $6.2 billion from $1.1 billion.

For all of 2008, revenue fell to $139.3 billion from $173.8 billion.

With losses mounting, Ford is accelerating restructuring actions. The company announced today it would trim 20 percent -- or 1,200 jobs -- from the U.S. operations of its Ford Motor Credit unit.

Ford Credit reported a net loss of $1.5 billion in 2008, following a profit of $775 million in 2007.

Ford's automotive operations lost $3.3 billion before taxes during the fourth quarter. The North American unit lost $1.9 billion before taxes. In Europe, Ford posted a pretax automotive loss of $330 million.

U.S. rival General Motors has received $9.4 billion in loans so far, part of a $13.4 billion package granted by President George W. Bush. Chrysler LLC has received $4 billion and says it needs at least $3 billion more

The Chevrolet Volt Plug-In Hybrid

The upcoming Chevy Volt is a serial hybrid-electric plug-in vehicle. This means that the electric motor does all the work and that the combustion engine only provides juice when the battery bank is depleted. A great idea for a motor vehicle, but not original. In the late 90's, GM announced a concept serial hybrid named the Impact and then later the EV1. You can see a picture of it here. Instead of wasting the past 12 years, GM could have been producing and refining this beauty. Imagine where we would be today if GM had stayed the course and not buckled under the iron fist of Big Oil.

Nevertheless, if GM will actually market and produce these cars, it will be a smashing success. Imagine being able to drive 40 miles each day without using a drop of gasoline. I have been imagining it for years but the auto manufacturers have let me down. By the end of 2010, GM tells us the Chevy Volt will hit the showrooms, but of course it will be in limited quantities. I want the Volt today and I want a choice of colors in my dealer's showroom!

From the GM Volt website:

The Extended-Range Electric Vehicle that is redefining the automotive world is no longer just a rumor. In fact, its propulsion system is so revolutionary, it's unlike any other vehicle or electric car that's ever been introduced. And we're making this remarkable vision a reality, so that one day you'll have the freedom to drive gas-free.

Chevy Volt is designed to move more than 75 percent of America's daily commuters without a single drop of gas.(2) That means for someone who drives less than 40 miles a day, Chevy Volt will use zero gasoline and produce zero emissions.(1)

Unlike traditional electric cars, Chevy Volt has a revolutionary propulsion system that takes you beyond the power of the battery. It will use a lithium-ion battery with a gasoline-powered, range-extending engine that drives a generator to provide electric power when you drive beyond the 40-mile battery range.

Chevy Volt. Fully charged 2010.

“We have devoted significant resources to this project: Over 200 engineers and 50 designers are working on the Volt alone, and another 400 are working on related subsystems and electric components. That's how important we think this is, and that's how much stock we place in the future of extended-range electric vehicles like the Chevy Volt.”

--- Tony Posawatz, Vehicle Line Director

General Motors to Unveil European Volt, aka the Opel Ampere

Another questionable moniker, yet there it is. The Opel Ampere. Maybe they should have named it the Capacitor, or Resistor, or Farad, or Impedance or Wattage, but Ampere it is. Even the Opel Ohm would have been catchy, but alas and alack, twas not meant to be. Less imaginative minds have prevailed, it would seem.

From GM-volt.com:

It has been known for some time that that Chevy Volt is a global vehicle intended to be sold and driven in many of the countries GM does business. Europe is clearly a key market intended for this car. We have also heard that the Volt will first appear there under the Opel brand, which is known for advanced technology.

The automaker has just announced that it will reveal what appears to be the European version of the Chevy Volt at the Geneva Auto Show on March 3rd.

They have given the five-door four-seater car its own name, the Opel Ampera. As well a teaser photo has been released. There are no technical specs at this point, however the photo shows the body is unmistakably that of the Chevy Volt although with signature Opel branding features. It is unknown whether this vehicle will use a diesel or gasoline range extender, but the first 60 km of driving will indeed be on pure electricity.

Per said Alain Visser, GM Europe Chief Marketing Officer, “With the Ampera, Opel will be the first European automobile manufacturer to provide customers several hundred kilometers of non-stop electric driving,”

It was also noted that “additional information on the Opel Ampera will be released March 3 at the Geneva Motor Show.”

UPDATE: GM Voltec spokesperson David Darovitz has confirmed to GM-Volt.com that the car is indeed the European version of the Chevy Volt.

The vehicle will also be produced as the Vauxhall Ampera.

Nothing But Depressing Headlines These Days

Have you had a chance to look at the news headlines today? They are simply brutal and too depressing to read the whole story! Actually, the headlines contain all the information that the reader needs to know.

Here are a few:

- Navistar to close Indianapolis dielsel engine plant
- GM cuts working week at Russian plant
- Mitsubishi extends Illinois plant shutdown
- Honda cuts more production in North America and Japan
- Treasury Dept. restircts lobbying for bailout money

These are all headlines from ONE DAY! Lord help us but we need a turnaround post haste. Stay tuned, I will post cheerier news next.

GM Announces Layoffs and Deeper Production Cuts

More bad news today for our ailing US economy. General Motors stated that it will lay off 2,000 workers at two of its plants and will further cut production in response to continuing sluggish sales. All of the jobs will be cut from two facilities, one in Lordstown, Ohio and one in Delta Township, Michigan.

General Motors has received about $13 billion in federal loans over the past month or so but it appears uncertain how they intend to prove to Washington that they can reverse the current sales trend. Could it be that the US populace has lost its infatuation with the automobile? Certainly in hard economic times, the last thing people really need is a new vehicle. At any rate, these announcements will affect production for the first two quarters of 2009.

From Automotive News:

"General Motors will cut about 2,000 jobs at two plants and plans periodic shutdowns at about half of its 19 U.S. factories as consumers continue to shun new vehicles.

The automaker will eliminate one shift at the end of the quarter at its Lordstown, Ohio, plant and its Lansing Delta factory in Delta Township, Mich.

The cuts mean a loss of about 800 jobs in Lordstown, where workers make the compact Chevrolet Cobalt and Pontiac G5. The Delta Township plant will lose about 1,200 workers, who make the Buick Enclave, GMC Acadia and Saturn Outlook crossovers.

In addition, GM will stop production intermittently at nine other U.S. plants and one Canadian factory for "some number" of weeks in the first and second quarters, GM spokesman Chris Lee said today.

The production cuts stem from depressed sales, Lee said. This month GM lowered its 2009 industry sales forecast to 10.5 million vehicles from a projection as high as 12 million in December.

"We're just aligning production with market demand," Lee said. "Nobody was able to buy any cars," he said, referring to the credit crunch that has deepened the U.S. recession.

The Lordstown plant ramped up from two shifts to three last summer as soaring gasoline prices increased sales of compact cars. But in November GM said it would return the plant to two shifts Feb. 2.

The changes announced today mean Lordstown will drop to one shift April 6, with the first and second shifts working alternate weeks starting Feb. 9.

The Delta Township plant's two shifts will alternate starting Feb. 2, with the reduction to a single shift going into effect March 30.

GM began 2009 with a 102-day supply of new vehicles, down from a 139-day stock Dec. 1. GM's figure is higher than the Jan. 1 industry average of 94 vehicles, which in turn is 50 percent higher than the level considered normal.

GM sold 3 million vehicles in the United States last year, down from 3.8 million in 2007. The industrywide total last year was 13.2 million, following fourth-quarter sales rates that dropped to 26-year lows."

Alan Mulally, Ford CEO, Proclaims They Don't Need Government Money

Ford CEO Alan Mulally sates, "“We don’t want to borrow any more money. We have sufficient liquidity to fund our transformation plan, which means our business is in a relatively good shape." Contrarily, GM and Chrysler have secured $17.4 billion in US Government secured loans as a bridge to becoming better, leaner auto manufacturers.

The question is, "What does this mean in terms of US consumer confidence?" Will potential car buyers look at Ford as being the most likely to survive and not declare bankruptcy? Will this even figure into their minds? I would think that only a small percentage of customers even realize that Ford did not receive the government hand outs.

Another factor to consider is that Ford does not have to adhere to government stipulations concerning the loans. They do not have submit their business plans as a contingency for further monies. All in all, I would say that Ford is in a relatively good position, whereas Chrysler and GM's are tenuous at best.

The Hymotion / A123 Systems Conversion Module for the Toyota Prius

Do you own a 2004 to 2009 Toyota Prius? These are the models years that can be converted to plug-in capability using the kit sold by Hymotion / A123 Systems. Hymotion started this business and then were later bought by A123 Systems, makers of Nanophospate Lithium ion battery cells. Their product is now a drop-in 5 kWh Lithium ion battery pack that works in conjunction with the Toyota Hybrid Synergy drive and allows the operator to drive in an all EV mode.

During installation, an EV switch is installed that lets the driver operate entirely on electrical energy without the ICE starting. The Prius can then travel about 15 or so miles using the additional battery pack and also boasts 100 mpg over the course of 40 miles. The 40 mile number is significant as it represents the maximum number of miles traveled by the majority of US commuters.

The Hymotion unit costs $9995 installed and is really one of the best aftermarket kits available to make your Prius a plug-in. Here are some specifics from the Hymotion web site:

"A123 Hymotion L5 Plug-in Conversion Modules are designed to convert Toyota Prius HEVs into PHEVs that can achieve up to 100 mpg for 30-40 miles*

Hymotion L5 animation here

Product Specifications

• Designed for Toyota Prius, model years 2004 – 2009
• ~ 5 kWh pack
• 5.5 hour charge time
• ~ 180 pounds
• Up to 100 mpg for 30-40 miles within electrically assisted driving range

• Meets strictest emissions standards in U.S.
• Crash tested to federal new vehicle standards
• $9995 – includes 3 year standard warranty and installation"

Of course, the difficult part of this upgrade is coughing up the 10 grand, especially in the ultra depressed financial times in which we find ourselves. However, in my opinion this is the best bang for the buck of ANY plug-in kit on the market.

In the future, I will look at other manufacturer's solutions to converting a late model Prius into a plug-in Prius. There are several options avaialble.

The Mitsubishi iMiEV All-Electric Vehicle

The Misubishi iMiEV is the company's foray into the eco-friendly, green domain of auto manufacturers. It is a very compact all-electric vehicle that is scheduled to be introduced in the United States in 2009. Let's hope they can stick to that date as we need all the alternate energy vehicles we can get our hands on.

The iMiEV (what a name, huh?) is powered by three asynchronous AC motors which are capable of regenerative braking. This means that the motors turn into genereators when the driver taps the brakes and thus helps slow the car down while simultaneously adding electricity back into the battery pack. This technique allows the car to have a greater range, thus allowing the battery pack to be somewhat smaller in size. Speaking of the battery, Mitsubishi is using a 550 pound, 330 volt, 16 kWh Lithium ion pack. This is enough juice to propel the car for 70 miles or so. Personally, I would prefer the iMiEV to have a 24 kWh battery pack and more than 100 miles range as this would cover the overwhelming majority of daily commutes.

Here are some photos and specs from wired.com:

The iMiEV is an electric version of the "i," which belongs to a popular class of small vehicles called Kei cars. Although tiny — just a hair over 11 feet long — the iMiEV is surprisingly roomy inside because the wheels are pushed to the corners and the battery, motor and other electronics are located beneath the floor.

The iMiEV is a real car, with all the amenities you'd expect to find in a compact or mid-sized car. Fit and finish is solid, though some of the plastic looked and felt cheap. Should the car ever make it to the United States, it will of course be left-hand drive.

The automatic transmission has three speeds, which might more accurately be called "modes." Drive ("D") provides full power. "Eco" tempers that by 10 percent and "B" maximizes regenerative braking to recover as much kinetic energy as possible and maximize battery life.

Dashboard display tells you how much battery charge you've got left in addition to things like how fast you're going and how far you've gone. You can't make it out in the photo, but the green display to the left of the gauge reads "Ready" and lights up once you've started the car. Electric motors are silent, so without the display you may not realize the iMiEV is running.

The iMiEV uses a 16-kWh, 330-volt lithium-ion battery that weighs 550 pounds. It's located beneath the front seats. Mitsubishi is developing and building batteries under a joint venture with the Japanese firms GS Yuasa and MMC called "Lithium Energy Japan."

The battery charges in about 12 hours using a standard 110-volt household outlet. Double the voltage to 220 and you cut charging time in half.

Affordable Plug-In Hybrid Conversion Kit for the Toyota Prius

Are you a budget minded individual? Then there is a company in California who has worked very hard to put together a DIY plug-in conversion package for the 2004 to 2009 Toyota Prius. To make things easier, Plug-In Supply of Petaluma, California has fabricated a battery box and collected the other hardware and software necessary to convert your Prius. Their complete system includes batteries, battery box, charger and wiring harness. They even offer an EV switch that allows operation up to 52 mph without the help of the internal combustion engine.

Here's how it works. Twenty batteries are connected in series yielding a pack voltage of 240 volts that is then connected to the Toyota NiMH battery pack in the Prius. The batteries are arranged nicely in a specialized battery box manufactured by Plug-In Supply that sits atop the spare tire in the rear well. the battery box is mounted on a hinge with hydraulic lifts so it can swing out of the way in case one needs access to the spare. Pretty nifty. The kit by itself retails for $4995 and most dealers will install it for a grand or so. This brings the conversion package to about $6,000.

While not as expensive as the Hymotion package, it still is a shock to most people's finances. This kit will allow 12 to 15 miles in all electric mode and is the PERFECT solution for those evening and weekend errands. If you have short commute to work, especially on city roads, you may even be able to avoid having the engine start at all. This is truly an alternative energy auto.

From Plug-In Supply, Inc:

Plug-In Supply Inc of Petaluma California is pleased to announce the availability of components and assemblies to build the Prius+ plug-in conversion invented by CalCars to convert a 40+ mpg Prius into a 100+ mpg Prius Plus (plus 1 cent/mile of electricity). With the conversion system installed, a Prius can be driven for the first 10-15 miles on electricity before reverting to standard Prius driving mode.

A PHEV owner plugs in the car overnight to recharge the battery pack. This saves gasoline by substituting cleaner, cheaper, domestic electricity for a portion of the gas that would otherwise be used to propel the vehicle. Electricity from the outlet sells for less than $1 per gas gallon equivalent (GGE).

The Prius+ conversion is the original and most successful non-commercial PHEV conversion for the Toyota Prius car.

Plug-In Supply products allow dealers to complete high-quality PHEV conversions.

The conversion system uses new extended life lead-acid batteries (over 800 cycles), for better battery longevity than was previously available. The combination of longer battery life and lower price improves the affordability of converting a Prius.

The PbA20 PHEV Assembly is a complete, tested, and ready to install pack. It provides access to the spare tire and contains 20 PbA20-12 lead-acid batteries, plus all high voltage components and control electronics in a strong welded steel enclosure. Expect about 10 - 15 miles of EV mode range.

Battery chemistry: Lithium Iron Phosphate (LiFePO4) or Lead Acid (PbA).
Expected battery life: 11+ years for LiFePO4, 2 years for PbA.

System weight: 150 lb for Lithium Iron Phosphate (LiFePO4) and 360 lb for Lead-Acid (PbA).
Battery Pack Mounting Location: under rear cargo deck on top of spare tire. Battery box lifts up on springs to access spare tire.
Capacity: 5kW
Voltage: 256 VDC
Charge time: 4 to 8 hours from any 110 VAC / 15A outlet.
On-board charger mounts under front seats or in cargo area.

The PbA PHEV Assembly is also available without batteries.

Summary of the features of the Plug-In Supply Prius+ PHEV conversion:
Three mode operation, Normal Prius, Enhanced Prius and Electric Vehicle.
Normal Prius is stock performance, PHEV engaged.
Enhanced Prius mode engages auxiliary battery pack to enhance the performance during normal Prius operation.
Electric Vehicle mode means gas engine does not start. To exit this mode car must be brought to a stop, turned off then restarted. Car restarts in normal Prius mode.
Range in EV mode: 10 to 15 miles per charge. Depends on terrain and driving style.
Max speed in EV mode: 52 mph.

The 2009 Honda Civic GX Natural Gas Vehicle

Do you want to purchase an alternative energy vehicle today? Honda motors is the only automobile manufacturer offering a natural gas powered vehicle. The car is basically a Civic with an engine tuned to run on compressed natural gas. It is a beautiful car and could possibly be my next purchase, if companies do not come through with electric cars.

What are the advantages of a compressed natural gas (CNG) vehicle? Let me list a few:

1. Compressed natural gas is plentiful in the United States
2. Greatly reduces our dependence on foreign oil
3. The infrastructure for delivering CNG already exists
4. CNG burns much cleaner than gasoline and qualifies as an ultra low emissions vehicle.
5. A CNG dispenser can be installed in your own garage, thereby eliminating trips to the pump.
6. CNG prices are generally cheaper than gasoline.

Why aren't people buying this car? I suppose it is because Honda does not really market it well. There is a premium to be paid for this car as compared to the ICE Civic, BUT there are federal rebates that consumers qualify for which negates the premium. Currently, the rebate is four thousand dollars.

T. Boone Pickens is a huge proponent of CNG and has outlined a plan for America to convert, but is having a hard time battling Big Oil. His website can be found here.

From the Honda Civic GX website, check it out!

Express your environmental individuality with a sporty Civic that doesn’t require a drop of gasoline.

Go Around the Gas Station

• Advanced Technology Partial-Zero-Emission Vehicle (AT-PZEV)*
• Fueled by Compressed Natural Gas (CNG) for nearly zero emissions
• Convenient Phill^® home refueling (optional)^†
• HOV lane access in many states
• 113-hp, 1.8-Liter, 16-Valve, SOHC i-VTEC^® 4-cylinder engine

Revel in the Ride

• Aerodynamic exterior with new six-sided grille
• Two-tier instrument panel
• MP3/Windows Media^® Audio (WMA) playback capability**

A Review of the New Honda Insight Hybrid

In the last post, we mentioned the all new Honda Insight Hybrid and I thought it would be good to publish a review. The Insight will be a direct competitor of the Toyota Prius with comparable fuel economy and a lower sticker price. I am surprised that it has taken auto manufacturers so long to come up with a competitor to the vaunted Prius, but the wait was worth it considering the value that Honda's Insight will provide. This offering could very well be the car of the year and will be affordable to the masses, which is what it will take to get the hybrid vehicle technology in everyone's garage.

From MSNBC.COM:

During boom times, value can go out of style, as dedicated followers of fashion pursue the latest trends and jockey for position in the social order with their accoutrements.

Whether it is outsized McMansions or blinged-out SUVs, when the economy is expanding, more consumers feel entitled to show off a bit. Advertisements cater to such impulses, counseling people that they deserve to treat themselves to something special.

Increasing interest in value should make the 2010 Honda Insight hybrid a popular choice, whenever people decide to start buying cars again. Once people open their wallets, they will likely do so with a mind to maximize their value, and the Insight will be waiting for them.

“We have a great deal of confidence that the Insight is the right car at the right time,” said Dan Bonawitz, vice president of logistics for American Honda.

Some might say that value is synonymous with fuel economy. But while efficiency plays a part — because we don’t want to get hijacked at the pump next time prices swing north of $3 — value for car consumers has more to do with purchase price and practicality.

That’s why tiny fuel-efficient cars like the original two-seat Insight have sold poorly, and it’s also why many shoppers who liked the combination of spaciousness and efficiency in Toyota’s Prius were put off by its price — now around $23,500.

Honda’s goal in designing the 2010 Insight was to find the value sweet spot, and it looks like they’ve hit it. The Insight marks the best intersection yet of the plots for price, efficiency and practicality.

Engineers accomplished this by designing a hybrid system with a priority on cost rather than maximum efficiency, scoring more bang for the buck than glittering technology showcases that no one can afford. They wrapped it in a five-door hatchback body that packs maximum cabin space into minimal physical size.

Many more hatchbacks are likely to come to market in the next few years, as consumers respond rationally to the design’s inherent flexibility, but in the meantime Insight drivers can appreciate the ability to fold down the rear seats and slide in large objects from the hatch’s load floor.

While Honda engineers sought a rational balance between cost and efficiency in the Insight’s hardware, they included software aimed at making the car more efficient by coaching the driver to go light on the gas pedal.

Honda The Insight’s dashboard color display changes to indicate relative efficiency without distracting the driver’s attention.

While the Prius and other hybrids have long featured video displays of fuel economy worthy of a Mario Brothers video game, Honda recognized the benefit of a simple approach: The color of the speedometer display changes to indicate relative efficiency without distracting the driver from the task of driving (the Insight’s speedometer is high-mounted at the base of the windshield, so that a driver can notice the color while still looking down the road).

The greener the display, the greener the driving. Floor it, and the speedometer quickly shifts to blue — this gives the driver a clear indication that he’s not driving as efficiently as he could. (I felt blue was sort of benign. A nice angry red might well have been aesthetically jarring, but it would have delivered an even more unmistakable message.)

The Insight’s onboard computer doesn’t stop with fuel economy. It not only shouts driving suggestions in real time like a soccer parent on the sidelines, it also keeps track of every detail like an obsessive baseball statistician.

US Sales of Gasoline-Electric Auto Sales Drops 9.9%

Here is some more bad news as concerns the auto industry. 2008 saw a decline of hybrid vehicles totaling nearly 10%. When gas prices skyrocketed, hybrid sales increased and Toyota Prius's actually sold for more than the MSRP. Now that gasoline is less than two bucks a gallon, prices have dropped. Further complicating matters is the global economic bust created by unscrupulous banking practices. Now automakers are up against the ropes and are torn between offering hybrids or promoting less expensive gas guzzlers.

Here is the main question; "What would you as a consumer do?" Considering the low price of gas and the premium price tag on a hybrid vehicle, are you going to spend more for the new technology? Apparently, car buyers are staying home and are not willing to commit to a new car purchase. Let's hope that our economy reverses course soon and hope that car manufacturers deliver reasonably priced alternative energy cars and trucks. The Honda Insight is one such vehicle and is expected to sell for 18 to 20 thousand MSRP.

From Automotive News:

U.S. sales of gasoline-electric hybrids fell 9.9 percent in 2008, after rising with gasoline prices early in the year and falling along with fuel costs and a collapsing auto market at the end.

Automakers sold 315,761 hybrids last year, 2.4 percent of the total vehicle market.

Toyota Motor Sales U.S.A. again sold about three of every four hybrids in the United States, despite new entries from General Motors. The segment-leading Toyota Prius reflected the topsy-turvy year: It tallied 91,440 sales in the first half and 67,444 in the second.

U.S. Hybrid Vehicle Sales
		2008	2007	% change
Chrysler LLC		81	-	-
Ford Motor Co.		19,522	25,108	-22.2%
General Motors		14,439	5,175	179.0%
American Honda		31,495	35,980	-12.5%
Nissan N.A.		8,819	8,388	5.1%
Toyota Motor Sales		241,405	275,779	-12.5%
TOTAL		315,761	350,430	-9.9%
Source: Automotive News Data Center, companies and National Renewable Energy Laboratory

"At $1.50 a gallon, the American public is not willing to pay for fuel-saving technology," GM Vice Chairman Bob Lutz said at last week's Detroit auto show.

American Honda Motor Co. and Toyota each sold 12.5 percent fewer hybrids last year than in 2007.

Ford Motor Co., No. 3 in hybrid sales behind Honda, suffered the greatest decline, down 22.2 percent. GM nearly tripled sales to 14,439 after adding hybrid versions of the Cadillac Escalade, GMC Yukon and Chevrolet Malibu and Tahoe. Honda sold one hybrid for every eight Toyota delivered.

Fuel prices changed habits

Consumers changed their buying habits when gasoline prices passed $3.50 a gallon in April, Fin O'Neill, president of the market research firm J.D. Power and Associates, said in a speech last week in Detroit. After topping $4 in July, fuel prices tumbled to an average of $1.62 per gallon last month.

The sliding cost of gasoline coincided with a global financial crisis that squeezed credit and dragged vehicle sales to 25-year lows in the fourth quarter.

Hybrids weren't immune. Prius sales in November and December plunged more than 45 percent, prompting Toyota to delay plans to build the car in the United States.

The abrupt shift in Prius demand shows that fuel-efficient vehicles lose some appeal when gasoline prices are low, AutoNation Inc. CEO Mike Jackson said Wednesday at the Automotive News World Congress. A government that mandates fuel efficiency should use a fuel tax to encourage consumers to buy energy-saving vehicles, he said.

"Cheap gasoline combined with fuel efficiency mandated by the government is an economic and environmental disaster for America," Jackson said. "When the cost per mile driven goes down, people buy bigger, faster" cars and trucks, he said.

But consumers do want fuel-saving technology, other speakers told the World Congress.

'Catching up'

"North America is catching up with the rest of the world -- particularly the North American consumer -- on the importance of these things," said Harold Krivan, president of the consulting firm Sawgrass Solutions LLC.

For now, automakers need to bring green technology's cost in line with its value to consumers, said Andrew Brown Jr., chief technologist at Delphi Corp.

"People want the technology, but it's got to be economical," Brown said. "That's the challenge in the industry now: to get the cost of those components down."

Most of the figures for hybrid sales come from automakers; the National Renewable Energy Laboratory provides estimates for Nissan, along with the 2007 totals from GM that were used to calculate its gains for last year.

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This blog will endeavor to discuss the various and sundry alternative energy choices for the modern automobile. Surely there is a better way than using fossil fuels and we will explore them and keep abreast of the auto industry. We would like to see the major manufacturers commence production of these alternative energy vehicles on a massive scale. This is the only means by which the higher costs of the vehicles can be driven down.

We will look at electric vehicles, plug-in hybrid vehicles, compressed natural gas, compressed air, E85, LPG, biofuels and any combination thereof. So check back often to keep abreast of the very latest.