GM Stressing Fuel Efficiency - New SUVs

[HarleyEarl]

http://www.nytimes.com/2005/09/21/business...9&partner=TOPIX

By DANNY HAKIM
Published: September 21, 2005
DETROIT, Sept. 20 - General Motors plans to market its next generation of large sport utility vehicles by promoting their gas mileage.

Talking about fuel economy in commercials for vehicles like the Chevrolet Suburban might seem counterintuitive, particularly since large S.U.V.'s get mileage in the teens at a time when Americans have become more sensitive to what it costs to fill up.

But G.M. executives said they would stress improvements that have been made in fuel economy for the large S.U.V.'s that will begin arriving in showrooms early next year.

G.M. is even considering ways to start marketing the fact that many of the vehicles can run on an ethanol blend instead of gasoline, a feature that many environmental advocates have criticized because it allows automakers to take advantage of a regulatory loophole.

G.M.'s marketing director, Mark R. LaNeve, said that talking about fuel economy was "going to be an integral piece of everything we do" in the S.U.V. campaign.

Mr. LaNeve spoke at a news conference on Tuesday where the company unveiled its remodeled large S.U.V.'s - including 2007 models of the Chevrolet Tahoe, GMC Yukon, Chevrolet Avalanche and a Cadillac Escalade bristling with chrome. On the inside, the vehicles have a more German feel, because domestic automakers see Audi in particular as a benchmark for interior refinement.

On the outside, they have more chrome and less gray plastic armor. They are also more aerodynamic, with less boxy windshields and tighter surface gaps. And they have appendages added to the front of their stiff steel frames to mitigate damage when they collide with smaller vehicles, like cars.

Holding ground in the large S.U.V. market is critical for G.M., and the overhaul of the vehicles, the first in seven years for many of them, has been a priority. The company commands about half of the large S.U.V. market, but in the last couple of years the total market has shrunk to 700,000 vehicles a year from about 900,000. Profit margins have also declined as steeper discounts have been required.

"That's the big issue: whither goes the full-size S.U.V.," said Joseph Phillippi, a consultant and analyst. He attended the news conference and was impressed with the new products, but cautioned, "You wouldn't call it a growth market."

Mr. LaNeve said G.M. would promote its large S.U.V.'s as the most fuel-efficient, powerful and stylish of the class.

Some models of the Tahoe will be the first large S.U.V.'s to be rated at just over 20 miles per gallon in combined city and highway driving under the government's testing procedures. While the government's fuel economy test significantly overstates the mileage people can get on the road, the Tahoe would be rated slightly higher than the current model, and exceed competitors like the Toyota Sequoia and Nissan Armada.

Mr. LaNeve said he met with other G.M. marketing executives on Monday to discuss ways to begin promoting ethanol.

G.M. already has 1.3 million so-called flex-fuel vehicles on the road that can use E85, an ethanol blend, but there are fewer than 500 gas stations nationwide that carry it. Automakers build flex-fuel vehicles because they get regulatory credits that allow them to make more vehicles with low fuel economy. Many customers are not aware their vehicles have the capability.

"If you're really into saving fuel, and oil dependency, you can get an ethanol-based vehicle," Mr. LaNeve said. "If you drive 15,000 miles in an ethanol-based vehicle here, you're burning under 200 gallons of oil-based gas a year. That's less than a hybrid."

If G.M. now sees flex-fuel vehicles as a marketing opportunity, ethanol is a contentious topic. While E85 has been 40 to 50 cents a gallon cheaper than regular gasoline in recent weeks, one does not go as far on a gallon of E85 as on a gallon of gasoline, lessening the cost advantage. And E85 is also supported by subsidies for corn growers, while gasoline is taxed.

But Mr. LaNeve said ethanol was one feature the company would start talking about. Advertisements, he said, would stress technologies like cylinder deactivation, which shuts down engine cylinders when they are not needed. Hybrid electric technology will appear as an option in 2007. Commercials for Chevrolet, he said, will make comparisons with the fuel economy of competing products.

At the same time, executives at G.M., which has lost $1.4 billion in the first half of the year, were stressing that they were no longer putting all their eggs in one basket. The company has been feverishly playing catch-up with Asian rivals by developing more lightweight S.U.V.'s, and is also trying to develop more credible passenger cars.

"We have a lot of options in terms of fuel efficiency," Mr. LaNeve said. "We believe most of our full-size owners will come in and take a look and will continue to buy the segment. I like to say, hey look, if you got three kids you can't give one back. Depending on your lifestyle, you're going to keep buying this kind of vehicle."

[Drew Dowdell]

http://www.nytimes.com/2005/09/21/business...9&partner=TOPIX
And E85 is also supported by subsidies for corn growers, while gasoline is taxed.

[post="17742"]<{POST_SNAPBACK}>[/post]

Not seeing a problem here. I much rather support a Kansas farmer then a Saudi prince.

[FUTURE_OF_GM]

[quote]G.M. is even considering ways to start marketing the fact that many of the vehicles can run on an ethanol blend instead of gasoline, a feature that many environmental advocates have criticized because it allows automakers to take advantage of a regulatory loophole.[/quote]

What exactly is the big problem here?????

Nothing to back that bold statement (jab against GM) up???? We get the soundbite that is supposed to sway our opinion negative, yet no proof of why it should sway our opinion? Typical.

E85 is quite a bit cheaper than gasoline now and it'll ease our dependence on, as the liberal media puts it; "terorist funding oil"

Just a bunch of greenies that need to get a job.

[quote]bristling with chrome.[/quote]

Nice subliminal way to tie into a negative stereotype.

What do Americans, especially self loathing Americans think when they hear "chrome" or someone implying something is loaded with it???? They think WEIGHT, BULK, BIG AMERICANA, INEFFICIENT CARS OF YORE, OVERKILL.... Need I go on?

[quote]While the government's fuel economy test significantly overstates the mileage people can get on the road, the Tahoe would be rated slightly higher than the current model, and exceed competitors like the Toyota Sequoia and Nissan Armada.[/quote]

Wow! This "journalist" really is either a card carrying green party nader humper, or either an anti-Detroit loser.

To bad nobody had the "Goodwill" to point the overinflated EPA numbers out when the "God's gift to the world" Prius was burning up the headlines.

What a coincidence.... Yeah, right.

****NOTE: Remember what I said: the media will try to SEVERELY downplay these mileage gains to try and disuade the consumer from GM trucks and trucks in general. The Tahoe is too competitive, so they must flat out LIE to steer people away. Especially since most of them are pissed about the new CAFE regulations and it's hurt on the asian firms. Wait 'til Toyota comes out with similar mileage though, then not a damn thing will be said about EPA claims.

[quote]"If you're really into saving fuel, and oil dependency, you can get an ethanol-based vehicle," Mr. LaNeve said. "If you drive 15,000 miles in an ethanol-based vehicle here, you're burning under 200 gallons of oil-based gas a year. That's less than a hybrid."[/quote]

CLASSIC!!!!

Promote it GM!!! I'm surprised this made the press.

[quote]If G.M. now sees flex-fuel vehicles as a marketing opportunity, ethanol is a contentious topic. While E85 has been 40 to 50 cents a gallon cheaper than regular gasoline in recent weeks, one does not go as far on a gallon of E85 as on a gallon of gasoline, lessening the cost advantage. And E85 is also supported by subsidies for corn growers, while gasoline is taxed.[/quote]

More self-agenda fulfilling from this "unbiased journalist"

1) Who cares and 2) Who cares in regard to those statements.

[quote]At the same time, executives at G.M., which has lost $1.4 billion in the first half of the year, were stressing that they were no longer putting all their eggs in one basket. The company has been feverishly playing catch-up with Asian rivals by developing more lightweight S.U.V.'s, and is also trying to develop more credible passenger cars.[/quote]

Hurry biased media or you'll miss your killshot!!!!!

I can't wait until GM debuts the hybrid GMT900. Then I get to watch the media brush it off, discredit it and try to explain why justifying living in a cramped, slow, death trap Prius is "STILL BETTER 'CAUSE WE SAID SO"

Bunch of pencil pushing yuppies.

[cmattson]

I'm amazed on how the use of chrome pulls negative and positive baggage depending on it's use. You say "bristling with chrome" and it pulls in a negative image of old, tired, same-old-same-old iron detroit's always been pushing. You mention "chrome accents" when talking about an interior, and your mind goes a different direction altogether.

[FUTURE_OF_GM]

I'm amazed on how the use of chrome pulls negative and positive baggage depending on it's use.  You say "bristling with chrome" and it pulls in a negative image of old, tired, same-old-same-old iron detroit's always been pushing.  You mention "chrome accents" when talking about an interior, and your mind goes a different direction altogether.

[post="18593"]<{POST_SNAPBACK}>[/post]

It's a nice welcome to the world of Social Psychology. (I'm going to major in it)

How true do you view that statement though? Is that not what comes to mind when you read it?

Heck, I'm a restorer and classic car lover and even I am not immune to the negative connotations brought forth by that statement.

[regfootball]

well, VW's are laden with chrome now. Audis too. the press can go FK itself.

[Teh Ricer Civic!]

E85 is not feasible for nationwide, we are far too big a country for it.