Auto Outlook: Carmakers banking on traditional gasoline engines for near future

By AL SWANSON, UPI Auto Writer  |  Jan. 27, 2013 at 5:30 AM
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Of all the new cars and concepts unveiled at the North American Auto Show in Detroit only a handful are all-electric or hybrids.

For all the "Green Car" promotion, it appears automakers have come to the conclusion the conventional internal combustion engine remains the industry's standard for the near future.

A study by the international tax, audit and advisory firm KPMG found while sales of electric vehicles hit a record last year, car company executives believe electrics won't account for more than 15 percent of total global new vehicle sales until at least 2025. That's when U.S. fuel economy standards will require vehicles to average 54.5 mph a gallon.

Manufacturers like Japan's Mazda are moving ahead with technologies like "SkyActiv," engineering out excess weight from vehicle frames, engines and transaxles to squeeze more mileage from gas-powered vehicles without sacrificing performance.

"The combustion engine today is still a very viable alternative," KMPG'S Betsy Meter told The Detroit News.

Ford is downsizing and turbocharging EcoBoost engines -- including a 1-liter, 3-cylinder engine that could fit in a suitcase. About 25 percent of the 200 global auto executives questioned by KPMG for its 14th Global Automotive Executive Survey said improving gasoline and diesel engines would remain a major focus for investment in the next five years.

"When you look at current [miles per gallon] estimates for new cars, it's very evident that automakers are continuing to significantly improve engine efficiency," KPMG National Automotive Industry leader Gary Silberg said.

At the auto show, General Motors showed the Cadillac ELR coupe, an upscale gas-electric hybrid based on the Chevrolet Volt, which could sell for around $60,000. Volkswagen unveiled CrossBlue, a concept midsize, six-passenger, plug-in electric-diesel SUV capable of going more than 600 miles on a single tank of fuel and battery power.

In the meantime, Nissan is cutting the base price of its Leaf electric car by 18 percent and improving batteries to boost the subcompact's driving range. Nissan sold fewer than 10,000 Leafs in the United States in 2012, less than half its stated goal.

The 2013 Leaf S carries a manufacturer's suggested list price of $28,800, but federal and state incentives could bring the drive-home cost down to less than $20,000, The New York Times said. The Leaf S will be made in Tennessee. First generation Leafs were made in Japan.

Nissan indicated it has no plans to give up on electric vehicle technology.

"Since we launched the Leaf in 2010, we've learned that people are very attracted to the advanced technology and other amenities, but they are also looking for a more affordable price point," Brian Carolin, Nissan senior vice president of sales and marketing, told the Los Angeles Times.

Forty-five percent of the 22 U.S. executives surveyed said plug-in electric vehicles and hybrids would account for 16 percent of auto sales by 2025, but 71 percent of all the respondents in 31 countries predicted internal combustion engines would offer better technologies like fuel management and start-strop systems to keep the edge for the short-term.

"Today's combustion engines can continue to offer consumers the fuel efficiency and performance they desire, and what's clear is that the conventional internal combustion engine is not going anywhere anytime soon," KMPG's Silberg wrote.

Major issues facing electrics remain consumer concern about battery range, recharging options and the higher buy-in cost despite government grants and incentives.

Hyundai, Kia accepting claims on overstated mileage

Owners of Hyundai and Kia vehicles will have at least until the end of the year to register for compensation for overstated mileage ratings.

The South Korean automakers told Sen. Jay Rockefeller, D-W.Va., in December dealers will receive compensation for taking part in the program. Hyundai and Kia said in November they would reimburse owners of nearly 1.1 million vehicles in North America because of misstated gas mileage claims on vehicle window stickers.

Hyundai withdrew mileage claims of 40 mph on four models following an EPA investigation.

The car companies face dozens of lawsuits and could spend more than $100 million on refunds based on a vehicle's mileage and gasoline prices, The Detroit News said.

John Mendel, vice president of sales for American Honda Motor Co., said Hyundai and Kia had betrayed the public trust.

"Competitive pressure should never let us betray the trust of our customers," Mendel said at the Automotive News World Congress, the News reported.

Separately, the head of the Environmental Protection Agency's Office of Transportation and Air Quality said EPA would review mileage claims of the Ford C-Max hybrid and Fusion hybrid. Both vehicles claim they get 47 mpg on the window sticker. EPA, which audits the fuel-efficiency claims of about 15 percent of the industry, plans to test a C-Max hybrid.

"I am very confident that the sticker is sound, but I am also committed to keeping up with technology," Chris Grundler told the News. "The integrity of that sticker is very, very important."

Alfa Romero sports car heading for North America

Fiat-Chrysler Chief Executive Officer Sergio Marchionne has confirmed the Alfa Romero brand will make a U.S. comeback with the rear-wheel-drive 4C sports car later this year.

"We're finalizing the car now, so it should be here by the end of the year," Marchionne said speaking to Inforum, a women's leadership group in Detroit.

Afla Romero, Fiat's luxury brand, pulled out of the U.S. market in 1995. Marchionne said he wants it to return with a full North American lineup of nine Alfa models by 2016, the Detroit Free Press said.

"A lot of work as gone on in the choice of architectures and models," he said. "But we've got to make sure than we have the powertrain set up. This remains my key objective right now."

Most of the new Alfas will be assembled at under-utilized plants in Italy, where European vehicle sales have flat-lined.

Mazda will make a two-seat, rear-wheel-drive roadster in Japan in 2015 that will be developed as the next-generation Alfa Spider and the fourth-generation Mazda MX-5 sports car.

Marchionne hopes the open top Spider will become a halo car for Fiat in the United States.

"This is territory that belonged to Alfa," he said.

Fiat says the two sports cars will be "differentiated, distinctly styled, iconic and brand-specific roadsters."

Same Bat time, new Bat channel

The classic Batmobile from the 1960's television show "Batman" has a new owner.

Rick Champagne, an Arizona logistics company executive, bid $4.62 million for the car that began life as the 1955 Lincoln Futura concept.

Customizer George Barris, 87, bought the two-seat, Plexiglas bubble-topped, 19-foot-long concept vehicle from Ford for $1 and spent $15,000 turning it into the Batmobile driven by the Caped Crusader and Robin, the boy wonder, on the television show, the Los Angeles Times said.

The original car was hand-built in Italy in 1954 and first shown publicly at the 1955 Chicago Auto Show.

The Batmobile had been on display at Barris Kustom Industries in North Hollywood since the television show wrapped in 1968.

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