Hybrids Stumble While Diesels Surge

The new-car sales figures for June must be a cause for concern for fans of hybrids. But at the same time they're very encouraging for diesel proponents. You don't want to read too much into one month's sales numbers, but the numbers do tell a story.

Ever since gasoline prices tumbled from their highs of last year, sales of hybrids have tumbled along with them. And while most automakers are shunning diesel engines right now, Volkswagen turned in sales numbers in June that should make everybody sit up and pay attention.

So, are we going to see a battle royale between hybrids and diesels? It's too early to tell, but here's what's going on in the market at this snapshot in time.

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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Ford Transit Connect: Case Study in Overregulation

The Ford Transit Connect is a cool little van unlike anything else on the American market. In fact, I think it has the capability of becoming something of a cult car. But it's also a shining example of why the auto industry faces too much regulation.

Even though the Transit Connect is already sold in 55 countries around the world it had to undergo numerous modifications before it could be sold in the American market. And while it's not at all unusual to modifiy imported vehicles up to our standards, it's hard to see how some of these changes will help the health or safety of American citizens.

Some of these changes are so ridiculous and inconsequential that it's actually funny to see what they are. Funny, that is, until you realize all they're doing is driving up the price of the product.

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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Unlocking GM's Inner Value

Even though it's bankrupt and the price of its stock has collapsed, General Motors is worth a lot more money than most people realize. And if the company were to take a radically new approach to how it runs its business the payoff could be enormous.

GM's market capitalization is at ridiculously low levels. The total value of its stock is presently less than half a billion dollars. But the company is really worth a lot more than that. When you add up the value of all the land, buildings, tools, machinery, equipment, patents, research labs, proving grounds and every other asset it has, GM is worth over $140 billion. There's even more value in the know-how, knowledge and experience of its people.

But how do you unlock all that value?

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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In this week's episode of Autoline After Hours, General Motors V.P. of Sales, Mark LaNeve, joins the intrepid trio of John McElroy, Jason Vines and Peter "Autoextremist" DeLorenzo for another "unusually frank" discussion about the motoring industry. You can submit questions to the panel at viewermail -at- autolinedetroit.tv to be answered on-air tonight during the show's Rapid Fire segment. Make the jump to watch it live beginning at 7 PM EST.

Three Ways to Save the Big Three

Now that the Big Three are finally brooming out all their old legacy costs, they're going to be in the best fighting shape they've been in for nearly 40 years. But how do we make sure they don't slip back into their bad habits like they have after every other crisis?

A lot of people have a lot of opinions about what's got to be done, but to me it all gets down to how the executives run these companies. Get them to do the right things and everything else will fall into place.

There's that old adage in business that goes, "Tell me how you're going to measure me, and I'll show you how I'm going to perform." And while it's all fine and good to establish specific benchmarks that trigger bonuses, it's got to go deeper than that.

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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Does Killing Off Dealers Really Help?

Thousands of GM and Chrysler dealers are getting wiped out as part of each company's bankruptcies. And while the surviving dealers will be much better off, GM and Chrysler are likely to see less revenue, lower market share and fewer service parts sales as a result of this action. Is it worth the trade off?

Actually, debating the pros and cons is now just an academic exercise. It was the Presidential Automotive Task Force which decided that thousands of dealers had to go, then set a quota they wanted met, and told the car companies to go out and do the dirty work. GM and Chrysler didn't have a choice, but in many cases they acted all too eagerly. Shutting down dealerships fit in beautifully with their long term plans, and now the government was telling them that they could do it for free!






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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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BOOM TIMES COMING IN THE USED CAR MARKET

The future looks so bright for the used car market that I'm almost tempted to try and get into that business myself. Even though car dealers are going through tough times trying to sell new vehicles, they are going to more than make up for that on their used car lots.

The reason I'm so bullish on the used car business is that we're facing a looming shortage of good used cars. First off, the new car market has fallen by roughly 7 million units since its peak two years ago. That translates into 7 million fewer trade-ins available in the used car market. And the story gets even more interesting when you start to dig down into those numbers.

Follow the jump to keep reading...

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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John McElroy has returned as the host of this week's Autoline After Hours, and in addition to being joined by the show's two regulars – former PR man Jason Vines and Autoextremist's Peter De Lorenzo – Robin Miller of SPEED and Autoblog's engineering wunderkind Sam Abuelsamid join the panel to discuss all the relevant news from the week that was.

The show officially starts in a few minutes, but you can hit the jump and start submitting questions and comments in the dialog below the video.

This week's Autoline After Hours is missing the show's traditional host, John McElroy, so instead, Autoextemist's Peter DeLorenzo will take the helm, with AAH regular and former Chrysler PR man Jason Vines. Joining the intrepid duo is BusinessWeek's David Welch and Car and Driver's new editor-in-chief, Eddie Alterman. Undoubtedly, there's plenty to discuss and you can join in on the fun by making jump and posing your own questions to the AAH crew in the integrated chat window. It's all live and it begins... now.

PLENTY OF LIFE LEFT IN THE PISTON ENGINE

There are all kinds of ways to boost the fuel efficiency of a vehicle. Hybrids are becoming more and more popular. Clean diesels seemed poised to make major inroads in the market. And even though they're a ways down the road, hydrogen fuel cells sure look promising.

But the problem with these technologies is that they add considerable cost to a car. Toyota has probably got the cost of its hybrid system down to about $2,500, but that's still a lot of money to add to the cost of the powertrain. At their present level of development, clean diesels probably carry $4,000-$5,000 worth of extra emissions control equipment. And hydrogen fuel cells aren't quite ready for prime time no matter what they cost.

Engine engineers complain to me all the time about these alternative technologies. They say it's unfair to compare what they are doing with gasoline-fueled piston engines to these alternatives. And it all comes down to money. They claim they can achieve comparable performance, emissions, and fuel efficiency at a lot lower cost.

Specifically, they say "Let me add just $1,000 worth of equipment and technology to my engine and let me show you what I can do."

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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