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GM claims that the Chevy Volt will get 230 miles per gallon

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GM is looking for a big PR push with the Chevy Volt, and their announcement that the new Chevy Volt will get 230 miles per gallon will certainly grab some positive attention for the beleaguered company.

General Motors Co. said today the Chevrolet Volt, its extended-range electric vehicle due out in November 2010, will get an estimated city fuel economy of 230 mpg, or 25 kilowatt hours per 100 miles.

GM will unveil 25 new models between now and the end of 2011, president and CEO Fritz Henderson said during an hour-long webcast this morning.

“When the Chevrolet Volt extended-range electric vehicle rolls off the assembly line late next year, it will be the first mass-production automobile to achieve triple-digit fuel economy, with an expected 230 mpg in the city, or 25 kilowatt hours per 100 miles,” GM said.

The Environmental Protection Agency declined to confirm the figure, which was based on a draft testing procedure. GM said the calculation is based on more than one vehicle electrical charge, since the average driver travels far less than 100 miles in a single day.

“EPA has not tested a Chevy Volt and therefore cannot confirm the fuel economy values claimed by GM,” said EPA spokeswoman Cathy Milbourn.

“EPA does applaud GM’s commitment to designing and building the car of the future: an American-made car that will save families money, significantly reduce our dependence on foreign oil and create good-paying American jobs.”

In recent days, GM had launched a “viral” marketing campaign featuring a green background and a “230” logo — with a plug in the place of the 0 — to build interest in today’s announcement. Many auto bloggers correctly guessed that the figure was connected to the Volt’s city fuel economy rating.

The viral campaign is another good idea, and it looks like we really might have a “new GM.”

That said, the important story here is we’re seeing a plug-in hybrid that will potentially be a game-changer in the auto business. For a country that imports a ton of foreign oil, it’s refreshing to see real progress on electric vehicles.

Of course, not everyone is impressed, including Nissan.

But at least one competing automaker isn’t convinced. “Nissan Leaf = 367 mpg, no tailpipe, and no gas required. Oh yeah, and it’ll be affordable too,” the folks over at Nissan’s electric vehicle Twitter feed wrote today. About an hour later, they added this statement: “To clarify our previous tweet, the DOE formula estimates 367mpg for Nissan LEAF.”

That’s even more great news. It looks like there will be serious competition here from other automakers, so perhaps consumers will have real choices, and we can make real progress towards a goal of eliminating oil imports.

Cash for Clunkers wildly successful

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We know that thousands of Americans are taking advantage of the Cash for Clunkers program, so the program is helping to drive auto sales and stimulate the economy. In case you haven’t noticed, we can use some stimulation.

Beyond that, however, it turns out that the program is even more successful than originally thought when it comes to replacing gas guzzlers with fuel efficient cars.

And the Transportation Department reported that the average gas mileage of the vehicles being bought was significantly higher than required to qualify for a rebate of $3,500 to $4,500. Of 120,000 rebate applications processed so far, the department said the average gas mileage of cars being bought was 28.3 miles per gallon, for S.U.V.’s, 21.9 miles per gallon, and for trucks, 16.3 miles per gallon.

“The statistics are much better than anybody dreamed they would be,” said Senator Dianne Feinstein, Democrat of California. The actual mileage gain so far, she said, was not due to the details of the law but “the good judgment of the American people.”

Senator Feinstein, along with Senator Susan M. Collins, Republican of Maine, was the author of an early version of a “cash for clunkers” bill that would have required bigger improvements in mileage. Their decision to express support for extending the current version of the program, at a news conference late Monday afternoon, was an important signal to other senators concerned about whether the program was doing enough for the environment.

Senator Charles E. Schumer of New York, an early backer of the Feinstein-Collins approach, also voiced support for an extension. “If it ain’t broke, don’t fix it,” he said. “It’s working in every way. It’s working as stimulus, it’s working to help families, it’s working to improve mileage.”

The chances are pretty good that Senate will vote this week to extend the program so that it can be signed by President Obama.

Some opponents of the program have expressed concern that auto sales will stall after the program ends, whether it ends now or in the fall after an extension. This concern is unfounded. Many people taking advantage of this program have older cars that they’ve driven for years, and many of them keep older cars for the simple reason that they are thrifty. Without this program, many of them would likely keep their old cars. With the program, they have a huge financial incentive to junk the old car and pick up a new one at a great price. Along those lines, Ford announced today that they see car sales rebounding through 2010, as pent-up demand starts to drive the market.

Clunker mania

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The cash for clunkers program is off to a roaring start, as Americans seem ready to purchase new cars when presented with a great deal. This is a very encouraging sign for the economy, as a boost in auto sales would go a long way towards getting us out of this recession.

The program is so popular that it’s running out of money after just one week. The House has passed a bill to add $2 billion to the original $1 billion program. The Senate will take it up next week. Senator Diane Feinstein won’t support the bill without tougher fuel standards, and John McCain might filibuster the bill in the Senate. It’s not a done deal yet.

Ford shocks the market by posting a profit

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The automotive landscape has been changing so rapidly it’s sometimes hard to keep up. GM and Chrysler had to be saved by the federal government, while Ford was able to avoid that fate. Their troubles have probably helped Ford, but Ford has also been on a tear with impressive new models like the Ford Fusion, and many more new models are in the pipeline.

Auto analysts expected Ford to show some improvement, but the announced numbers were a pleasant surprise for many.

Ford Motor Co. posted a surprise profit of $2.3 billion for the second quarter — a sharp contrast to the whopping $8.7 billion loss it reported for the same period a year ago — but the profit was largely due to one-time gains related to its debt reduction moves.

Even with those special items removed, the Dearborn automaker surprised Wall Street with a pre-tax operating loss of $424 million for the second quarter of 2009, excluding special items — a $609 million improvement compared with the second quarter of 2008.

After taxes and excluding special items, Ford posted an operating loss of $638 million in the second quarter, or 21 cents per share, compared with a loss of $1.4 billion, 63 cents per share a year ago. That also was a marked improvement over the $1.4 billion loss — $1.8 billion after taxes and excluding special items — that Ford reported for the first three months of the year, when it lost 75 cents per share.

Wall Street had been anticipating a loss of 52 cents per share, after taxes and excluding special items, according to a survey of a dozen analysts by Thomson Reuters prior to today’s announcement.

“While the business environment remained extremely challenging around the world, we made significant progress on our transformation plan,” said CEO Alan Mulally. “Our underlying business is growing progressively stronger as we introduce great new products that customers want and value, while continuing to aggressively restructure our business and strengthen our balance sheet.”

It looks like Alan Mulally’s turnaround efforts are on track.

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