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Chevy Volt Tax Incentives Not Guaranteed

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With the price of fuel on a steady rise, consumers have turned to environmentally friendly hybrid and electric vehicles. The demand for these vehicles is leading to shortages throughout the United States and have resulted in dealership markups, some over $20,000 above the suggested retail price. Government incentives allow a $7,500 tax credit on these vehicles, but consumers may be surprised to find that some Chevrolet Volts found on dealership lots are being sold as “used” and no longer qualify..

A report in the National Legal and Policy Center (NLPC), say that some Chevrolet dealers are selling hybrid cars to other dealerships who are claiming the tax credits for themselves. Mark Modica, and investigator for the watchdog group, claimed that one Chicago Chevrolet dealer was selling a used Volt with only 10 miles on it. GM spokesman, Robert Peterson, says that while they do not encourage these transactions between dealerships, there is nothing GM or regulators can do about it. He does not believe that these transactions are done for the sole purpose of claiming the government tax credit, but are dealerships who are ineligible to sell the new Volts, trying to get these cars for their showrooms. He encourages dealers’ to have patience as the Chevy Volt rolls out nationwide. GM expects to produce only about 10,000 Volts this year, but hopes to increase production to 45,000 in 2012.

Tesla Releases 5.3 Million Additional Shares

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Tesla Motors Inc. has announced that they will be releasing another 5.3 million shares in a secondary public stock offering of $28.76 per share. These shares will be in addition to a private sale of 1.4 million to Elon Musk, CEO and co-founder of Tesla, plus an additional 637,475 shares to Blackstar Investco LLC, an affiliate of Daimler AG. The company hopes to raise about $211 million which will go towards developing their new SUV like vehicle, the Model X.

In June of 2010 when Tesla first went public, the sale was a big success. The stocks were estimated to sell at about $15 a share but ended going up to as high as $19. Just two days after the release, the stock shot up to almost double the first offering. Despite the huge success, the Tesla IPO soon lost it’s momentum.

Tesla is not expected to make a profit for another two years. They currently sell just one vehicle, the Roadster, a sporty electric car popular with the rich and famous. The first public stock offering has allowed them to develop a more affordable model, the Model S, which will be released to the public next year. The company is currently developing battery packs and chargers for Daimler and Toyota, and have been working with Toyota to develop an electric version to the RAV 4. Tesla shares currently remain steady around $27.00.

Alleged Unfair Dealings At Chrysler Grow

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A new dealership group know as “California Superstores” is buying up former Chrysler dealerships in California as a way to beat the high cost of real estate and rebuild Chrysler’s slow market in the United States. Complaints from existing Chrysler dealers say that the alliance between Chrysler and the New York Hedge fund is leading to an unfair advantage for existing dealerships. They have alleged that Chrysler is providing below market rent subsidies that have not been offered to them. Peter Welch, president of the California dealers association, said he is unfamiliar with the terms of the California Superstores venture, but has heard many concerns among existing Chrysler dealers.

California Superstores has already opened six stores in California, and plans to open eight more in areas where Chrysler has done poorly. The plan is to eventually open stores on the East Coast, according to Carlos Hoz de Vila, managing partner of California Superstores.

In an unrelated situation, the state dealers association has brought forward complaints against Chrysler, saying that they are operating an illegal factory owned store at Motor Village L.A. in downtown Los Angeles. The California New Motor Vehicle Board has asked the state Department of Motor Vehicles to investigate the complaint.

Chrysler has recently announced that they have paid back $7.5 billion in government loans allowing them to continued their integration with Fiat, a merger that has been in the making for almost two years now.

NHTSA Investigates Jeep Wranglers

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The National Highway Traffic Safety Administration (NHTSA) has opened an investigation into some 2007-2008 Jeep Wrangler vehicles after receiving almost 30 complaints of illuminated airbag warning lights. The investigation has lead the NHTSA to a defective clock spring wiring assembly that may prevent the airbag from deploying during an accident. The problem seems to be more prevalent in right hand drive Wranglers, but the NHTSA wants to investigate the problem further before issuing a recall. If the investigation should lead to a recall, about 220,000 Jeep Wranglers could be affected.

Toyota Recalls Prius Hybrid Vehicles

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The Toyota Motor Company has announced a recall for almost 52,000 2001-2003 Prius Hybrid vehicles in the United States to replace the electric power steering pinion shaft attachment nuts. The nuts securing the pinion shaft in the steering gear box assembly may become loose when the steering wheel is repeatedly and strongly turned to the full lock position. Eventually, the driver will notice that the steering wheel will become harder to turn when making a left hand turns. Owners receiving recall notices will be able to take their vehicle to their local dealership where technicians will replace the attachment nuts with an improved nut. For more information, Prius owners can contact the Toyota Customer Experience Center at 1-800-331-4331 or go to www.toyota.com/recall.

Fewer Cylinders Now Offer More Power

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In April of 2010, when the Department of Transportation (DOT) and the Environmental Protection Agency (EPA) came out with their national greenhouse gas emission standards, there were concerns about how the new requirements would be received. It was expected that automobile manufacturers would turn to more efficient conventional technologies, while others would go one step further and pursue more advanced fuel saving technologies like diesel, hybrid and electric vehicles. Today, with gasoline prices on a steady rise, Americans are demanding that their new cars not only meet, but exceed the standards set by the government. Because some consumers are still skeptical of the new hybrid and electric technologies, many have chosen to trade in their V-6’s for more fuel efficient four cylinder engines.

Four cylinder engines now account for almost 65% of all vehicles built in the U.S., Canada and Mexico. This is the biggest shift since the 1980’s when consumers traded in their V-8’s for the smaller V-6 engines. It is expected that within the next five years, over half the vehicles in the U.S. will be four cylinder engines. But todays consumers don’t have to give up power to drive the smaller engine vehicles. New technologies have left the underpowered four cylinder engines a thing of the past, and automakers have changed their marketing strategies to focus on the horsepower and fuel economy instead of the number of cylinders a vehicle has.

Ford new generation Explorer will soon offer two liter four cylinder “Eco Boost” engine and are already working on a 1.0-liter, three-cylinder engine.

BMW, who has not built a four cylinder engine in the U.S. for over a decade is now offering their customers the new Z4 sports car scheduled to go on sale this year, and have also been working on a three cylinder engine.

Hyundai has almost abandoned anything bigger than a four-cylinder, which accounts for nearly 90% of its U.S. sales.

And finally, automobile manufacturers like Honda, Toyota and Nissan, who were once criticized for their small powerless vehicles, are now leaders in the new fuel efficient, environmentally friendly technologies.

Nissan Investigated For Brake Problems

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The National Highway Traffic Safety Administration (NHTSA) is investigating brake problems with the 2007-2008 Nissan Altima, after receiving twenty complaints of loss of braking power. Altima drivers complained that the “brake warning” light would come on intermittently while driving, and after taking in the vehicle for service, were told that the brake master cylinder was leaking and needed replacement. If the investigation should lead to a recall, almost 440,000 2007-2008 Altimas could be affected.

In 2008-2009, Nissan recalled over 160,000 2007-2008 Sentra vehicles for the same problems.

New Fuel Economy Window Stickers

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The Environmental Protection Agency (EPA) and the Department of Transportation (DOT) unveiled their new fuel economy window stickers on Wednesday, saying that the new stickers will show the most changes in thirty years. The new labels will allow consumers to compare conventional cars, hybrids and all electric vehicles, giving information on greenhouse gas ratings, emissions, smog ratings, and fuel costs. The new stickers are scheduled to appear on the new 2013 models, but automakers have the option to start using them on on 2012 models as well.

Federal regulators had originally considered using a letter grading system from A to D, comparing fuel economy and air pollution to those of the entire fleet of new cars, but automakers objected, saying that the stickers were too simplistic and potentially misleading to automobile consumer’s. The government instead decided to go with a much busier label with more information and a sliding scale comparing vehicles across classes. According to transportation secretary, Ray LaHood, “These labels will provide consumers with up-front information about a vehicle’s fuel costs and savings so that they can make informed decisions when purchasing a new car.”

The label will also include a Quick Response Code (QR Code) that can be scanned by a smart phone to get information on cost estimates based on a consumer’s driving habits and the price of gasoline and electricity of their area. This information will also be accessible to vehicle shoppers online.