Automotive News - September 29, 2008 - (Page 8) 8 • SEPTEMBER 29, 2008 advertising Taxpayers at risk if firms get fed loans — then fail Harry Stoffer hstoffer@crain.com Saving gasoline How Hyundia Motor Co. plans to boost mileage Lighter materials Gasoline direct injection More 6- and 8-speed transmissions Turbochargers Opening the tap Possible timetable for releasing $25 billion in low-interest federal loans to the industry Before Oct. 1: President Bush signs law funding the program. End of November: Energy Department writes rules to manage loans. Late 2008/early 2009: Automakers and suppliers apply for loans. Early 2009: First loans are issued (industry hopes). Mid-2009/mid-2010: First loans are issued (Energy Department predicts). New York bankruptcy lawyer Albert Togut said he is amazed at the lack of debate over the loan package. “I’ve never seen anything like this,” Togut told Automotive News. A much smaller federal bailout of Chrysler Corp. in 1979 was hard-fought, he noted. Togut said his “gut and instinct” tell him the government will protect taxpayers if bankruptcies were to occur among companies that get the loans. But economist David Littmann says the prospect of the federal government putting itself at the front of the line of industry creditors would aggravate the industry’s difficulty in seeking new commercial loans. “That uncertainty alone would curtail any further extension of credit,” says Littmann, senior see LOANS, Page 29 WASHINGTON — Automakers and suppliers that tap $25 billion in federal loans will repay taxpayers with interest and create jobs, advocates insist. But neither of those outcomes is guaranteed, independent experts respond. The government “will have no means of recovery” if a company gets a loan and then fails, economist Daniel Luria says. Luria does not object to industry aid. He cowrote a 2004 study that concluded U.S. companies need financial help from government to build advanced, fuel-efficient vehicles, especially hybrids. The UAW used the study to build support for federal aid. The study, by Luria’s Michigan Manufacturing Technology Center and the University of Michigan, proposed federal tax credits. Instead, Congress and the White House authorized direct low-interest loans in an energy law enacted last December. The Detroit 3 became outspoken proponents of the loan program this year, when their borrowing costs soared — in some cases to about 20 percent, or roughly four times the federal interest rate. Hyundai: Drivetrain key to more mpg Hans Greimel hgreimel@crain.com Nothing like it Over the weekend, the Senate was scheduled to consider a bill with $7.5 billion in spending to launch the loan program. The House of Representatives approved the funding last week. President Bush was expected to sign the measure — unless it became tied at the last minute to too many unrelated spending proposals. BRIAN WILLIAMS/BRENDA PRIDDY & CO. ■ Buick looks upscale Although this test vehicle could be confused with a Lexus GS, it’s actually the 2010 Buick LaCrosse. The camouflage can’t hide the distinctive Buick grille. General Motors’ intent is to give the new sedan the upscale look and feel found on some luxury sedans but at a LaCrosse price. The LaCrosse is the first U.S. model developed on GM’s re-engineered, front-drive, global Epsilon vehicle architecture. SEOUL — Hyundai Motor Co. says it can improve the mileage of its U.S. fleet with lighter vehicles, gasoline direct injection and six- and eight-speed automatic transmissions. By 2010, the South Korean automaker wants to make its fleet 5 percent lighter on average compared with 2007, partly by using new materials. “We have the technology, but some of it we couldn’t justify because of the cost,” Lee Hyun-soon, HyundaiKia Automotive Group’s r&d chief, said here. “But because of high oil prices, we can utilize more technology to improve our fuel economy. “The biggest improvements will come from powertrain, engine and transmissions.” Hyundai trails only Toyota and Honda in the U.S. corporate average fuel economy rankings. Hyundai averages about 30 mpg for cars and 25 mpg for light trucks, according to consultant CSM Worldwide. Under new U.S. CAFE standards, the National Highway Traffic Safety Administration expects Hyundai to have targets of about 37.5 mpg for cars and 31.0 mpg for trucks by 2015. To improve mileage, Hyundai will use more gasoline direct-injection engines, turbochargers with direct injection and six- and eight-speed automatic transmissions, Lee said. “Even with mid-sized and smaller vehicles, we will use a six-speed automatic gearbox to improve the fuel economy,” Lee said. Hyundai doesn’t have any eight-speed automatics now, but they will be launched in two years in the high-end Genesis and Equus sedans, Lee said. The eight-speed will be supplied by Hyundai Powertech, a fully owned subsidiary. The gearbox will replace transmissions sourced from ZF Friedrichshafen AG and Aisin Seiki Co. Direct injection will first appear in 2010 in 2.4-liter and 3.5-liter engines, Lee said. Turbocharged direct injection will arrive a year later. Hyundai plans to shed vehicle weight by using more plastic, aluminum and high-tensile sheet metal. The lighter materials will be employed in doors, trunk lids, roofs, hoods and underbodies. “Costwise, it won’t benefit us because all these new materials cost higher than conventional materials,” Lee said. “But we can save fuel and at the same time get better performance.” Hyundai has no plans for electric vehicles, he added. “The usage of that kind of 100 percent electric vehicle will be very, very limited,” Lee said. “We are talking about a huge amount of batteries sitting in the car. Who can afford that?”c GM plans high-tech small engines for Volt and Cruze Richard Truett rtruett@crain.com FLINT, Mich. — The Chevrolet Volt got a little closer to the production line last week when General Motors committed $370 million for a new plant here that in two years will start cranking out 800 1.4-liter engines a day. The plant will make two versions of the 1.4-liter engine. A turbocharged version rated at 140 hp will go into the Chevrolet Cruze compact. A nonturbo version will be for the plug-in Volt. The cars, which share an architecture, are due in late 2010. GM officials would not say how powerful the Volt’s engine will be. GM is buying the Volt’s electric motor from a supplier but may replace it with one that GM engineers are designing, said Tom Stephens, GM executive vice president of global powertrain. He said the GM-designed electric motor could be used in the next-generation Volt. Unlike a regular gasoline car engine, the Volt’s 1.4-liter won’t be connected to the wheels. Instead, it will power a generator to make electricity for the car’s motor. Stephens said the Volt’s engine will be tuned to run in certain rpm ranges where it will use the least fuel. He also said it won’t act like a regular engine when a Volt driver steps on the gas pedal because the revving of the engine isn’t related to vehicle speed. Stephens said the engines will have premium features such as dual overhead cams, special oil pumps and variable valve timing, all of which boost fuel efficiency. “We expect the Cruze to be the segment leader in fuel economy,” Stephens said during a press conference to announce both engines. The Cruze, about the size of a Ford Focus, will have one of the smallest engines on the market. But Stephens said the 1.4-liter turbo will deliver the performance of a larger engine. Honeywell Transportation Systems will supply the turbochargers. The two Flint engines are part of a family of small four-cylinders GM has built around the world in varying sizes since 1997. The smallest is 1.0 liter. GM has no plans to launch that engine in a North American product. The 1.4-liter Flint engines are a new size that, so far, will be unique to North America. By 2011, Stephens predicted, onethird of GM’s North American engines will have four cylinders.c http://www.zadv.com http://www.zadv.com
Table of Contents Feed for the Digital Edition of Automotive News - September 29, 2008 GM, Ford and Chrysler place new-product bets Credit freeze could mean cash crisis Mr. Big Volume reaches the end of the line Korea's revolving door Mazda quits Ford Credit for Chase Mitsubishi, UAW reach tentative agreement Volt could break feds' 100 mpg ceiling Chase cuts back on auto leasing Target for Traverse: No. 1 in large crossovers BMW's new 7 series: Timing may be all wrong Tucson revisited Can Ford light fire under Fiesta? Lithia puts brakes on used-car stores Revived Mercury will focus on 3 segments VW taps 'zealots' to promote diesels Farley, Leuliette will kick off World Congress The new Soul (and nose) of Kia Hyundai: Drivetrain key to more mpg Taxpayers at risk if firms get fed loans - then fail GM plans high-tech small engines for Volt and Cruze Buick looks upscale Denso says U.S. woes will cut its profits Denso: No plans to make hybrid parts in U.S. Bailouts are a bad idea Chic small cars? Check them out at the Paris show Credit's no problem, but a weak brand is Helping dealers helped GM Ford field rep didn't help at all Who knew? Electric cars are fun to drive Where is the power going to come from? Hyundai shifts its U.S. ad agency Hyundai, Kia mold separate identities Behind on hybrids, Hyundai sets high goals Dealers Flashes of genius, years of turmoil No cop-out; car designed for police use PICTURE THIS: A trip to the bank RV sales drop 31.9% in June Mexico sales off 4.8% in Aug., 1.2% for 8 mos. Suzuki to aim pickup at motorcycle owners Experts: Learn Korean hierarchies Readers' comments on Bill Heard's collapse Bill Ford sells some Ford stock CarMax net income falls ArvinMeritor raises forecast Toyota plans CNG concept Chrysler cuts 250-300 salaried workers Minority supplier drops stamping business Will Cerberus buy up Chrysler to wave bye-bye? Rioters kill supplier exec in India No pickup seen for pickups Piech's ploy was masterstroke in war with Porsche Honda's highway groove music: It sounded better on vinyl St. Louis dealer to paper that outsourced typesetters: 'Deal me out' Automotive News - September 29, 2008 Automotive News - September 29, 2008 - (Page Intro) Automotive News - September 29, 2008 - (Page Bellyband1) Automotive News - September 29, 2008 - (Page Bellyband2) Automotive News - September 29, 2008 - Mr. Big Volume reaches the end of the line (Page 1) Automotive News - September 29, 2008 - Mr. Big Volume reaches the end of the line (Page 2) Automotive News - September 29, 2008 - Volt could break feds' 100 mpg ceiling (Page 3) Automotive News - September 29, 2008 - Tucson revisited (Page 4) Automotive News - September 29, 2008 - Tucson revisited (Page 5) Automotive News - September 29, 2008 - The new Soul (and nose) of Kia (Page 6) Automotive News - September 29, 2008 - The new Soul (and nose) of Kia (Page 7) Automotive News - September 29, 2008 - Buick looks upscale (Page 8) Automotive News - September 29, 2008 - Buick looks upscale (Page G1) Automotive News - September 29, 2008 - Buick looks upscale (Page G2) Automotive News - September 29, 2008 - Buick looks upscale (Page G3) Automotive News - September 29, 2008 - Buick looks upscale (Page G4) Automotive News - September 29, 2008 - Buick looks upscale (Page G5) Automotive News - September 29, 2008 - Buick looks upscale (Page G6) Automotive News - September 29, 2008 - Buick looks upscale (Page G7) Automotive News - September 29, 2008 - Buick looks upscale (Page G8) Automotive News - September 29, 2008 - Buick looks upscale (Page G9) Automotive News - September 29, 2008 - Buick looks upscale (Page G10) Automotive News - September 29, 2008 - Buick looks upscale (Page G11) Automotive News - September 29, 2008 - Buick looks upscale (Page G12) Automotive News - September 29, 2008 - Flashes of genius, years of turmoil (Page 9) Automotive News - September 29, 2008 - Denso says U.S. woes will cut its profits (Page 10) Automotive News - September 29, 2008 - Denso says U.S. woes will cut its profits (Page 11) Automotive News - September 29, 2008 - Ford field rep didn't help at all (Page 12) Automotive News - September 29, 2008 - Ford field rep didn't help at all (Page 13) Automotive News - September 29, 2008 - Where is the power going to come from? (Page 14) Automotive News - September 29, 2008 - Where is the power going to come from? (Page 15) Automotive News - September 29, 2008 - Hyundai, Kia mold separate identities (Page 16) Automotive News - September 29, 2008 - Hyundai, Kia mold separate identities (Page 17) Automotive News - September 29, 2008 - Behind on hybrids, Hyundai sets high goals (Page 18) Automotive News - September 29, 2008 - Behind on hybrids, Hyundai sets high goals (Page 19) Automotive News - September 29, 2008 - Dealers (Page 20) Automotive News - September 29, 2008 - Dealers (Page 21) Automotive News - September 29, 2008 - RV sales drop 31.9% in June (Page 22) Automotive News - September 29, 2008 - RV sales drop 31.9% in June (Page 23) Automotive News - September 29, 2008 - RV sales drop 31.9% in June (Page 24) Automotive News - September 29, 2008 - RV sales drop 31.9% in June (Page 25) Automotive News - September 29, 2008 - RV sales drop 31.9% in June (Page 26) Automotive News - September 29, 2008 - Mexico sales off 4.8% in Aug., 1.2% for 8 mos. (Page 27) Automotive News - September 29, 2008 - Suzuki to aim pickup at motorcycle owners (Page 28) Automotive News - September 29, 2008 - Experts: Learn Korean hierarchies (Page 29) Automotive News - September 29, 2008 - Readers' comments on Bill Heard's collapse (Page 30) Automotive News - September 29, 2008 - Chrysler cuts 250-300 salaried workers (Page 31) Automotive News - September 29, 2008 - Minority supplier drops stamping business (Page 32) Automotive News - September 29, 2008 - Minority supplier drops stamping business (Page 33) Automotive News - September 29, 2008 - St. Louis dealer to paper that outsourced typesetters: 'Deal me out' (Page 34) Automotive News - September 29, 2008 - St. Louis dealer to paper that outsourced typesetters: 'Deal me out' (Page 35) Automotive News - September 29, 2008 - St. Louis dealer to paper that outsourced typesetters: 'Deal me out' (Page 36)
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