Indy 500 and Cheap Gas
Maybe you missed the big race because you were shopping for a new GM vehicle this weekend. If you live in California or Florida, who could blame you? General Motors is promising customers in those two states that for a full year after purchasing or leasing selected vehicles, they will not pay a penny more than $1.99 per gallon. Here’s how it works: take delivery of your new car or truck before the end of the day on July 5, and GM will give you a pre-paid credit card with $100 on it. Buy gas like you normally would. The OnStar telematics system will track your mileage and report it to GM. Once a month, GM will use the reported mileage to determine your refund. To determine your refund, GM will calculate the difference between the promised $1.99 per gallon and the average cost for a gallon of premium fuel in California or Florida as reported by the American Automobile Association. GM then multiplies the result by your actual mileage and will credit your account based on the EPA city fuel economy rating of your vehicle. Because the pre-paid card works just like a MasterCard, the credit can be used for anything, not just gas.
The GM Fuel Price Protection program includes 2006 and 2007 model year vehicles. In California, eligible models include SUVs like the Cadillac SRX, Chevrolet Suburban, Chevrolet Tahoe, GMC Yukon, GMC Yukon XL, Hummer H2, and Hummer H3. Cars covered by the program are the Buick Lucerne, Chevrolet Impala, Chevrolet Monte Carlo, and Pontiac Grand Prix. Floridians can choose the Buick LaCrosse instead of the Lucerne, in addition to the Impala, Monte Carlo, and Grand Prix – no SUVs are eligible for the program in the Sunshine State. For more details, see www.fuelprotection.com.
Volkswagen models are also causing problems for other motorists. The company is recalling 362,000 Jetta and New Beetle models for brake light malfunctions that keep the lights from illuminating during braking, or keep them illuminated after braking is completed. Affected vehicles include third-generation Jettas made in 1999 and 2000, fourth-generation Jettas made between 1999 and 2002, and the 1998 to 2002 New Beetle.
Goodbye VW Diesel
Volkswagen might think this is a bad place to be, but Ford is struggling with worse problems. Standard and Poor’s is considering cutting Ford Motor Company’s investment grade deeper into junk, at that same time that General Motors is enjoying a bit of a stock rally. According to Bloomberg, on January 1 of this year, Ford stock traded at $8.93 a share. At the closing bell on May 25, the stock had declined to $7.15 a share. Compare that performance to General Motors, which Merrill Lynch bumped from a “neutral” rating to a “buy” recommendation last week. At the start of 2006, GM was valued at $18.90 a share. At the close of business last Thursday, it was up to $27.90 a share. One reason GM’s stock is rising: more than 20,000 employees have accepted the company’s buyout offer, putting GM ahead of target on a key part of its massive restructuring plan with a month to go before the deadline.
Detroit 3 in DC
For those who care to know, Hillary Clinton is in Detroit’s corner. Clinton, expected to be a front-runner for the Democratic presidential ticket in 2008, is calling for tax breaks for the Detroit Three, a mandate forcing oil companies to install more alternative fuel pumps at gas stations around the country, and prudence in hiking corporate average fuel economy requirements. Speaking at a meeting in Washington D.C. this week, the senator from New York said: “I am a passionate believer that we’ve got to enable our three automakers to survive. Some people are flippant about that. It’s 1 in every 10 jobs in America.”
To be fair, the Detroit automaker also announced that it will be expanding its Ypsilanti, Michigan transmission plant, but Wagoner’s plea doesn’t address the fact that as his company sheds jobs and closes operations around the country, transplants from Korea and Japan are picking up the slack by investing billions of dollars in red, white, and blue soil. Should we honestly consider a Chevy Malibu over a Honda Accord just because Wagoner is guilting us into it? That’s for you to decide.
Pimp My Hybrid
Maybe that means MTV will be pimping more Ford Escape Hybrids now that Galpin Motors in California’s San Fernando Valley has replaced West Coast Customs as the new home for the popular Pimp My Ride television show. Long known for “Galpinizing” its cars with custom aftermarket add-ons, the company’s holdings include the world’s largest Ford dealership, and to help launch the next season of the show in its new home, MTV will give away a customized Lincoln Mark LT. Too bad…we were hoping for a pimped 1977 Pinto Cruising Wagon, complete with rainbow stripes, bubble window, and an oversized hood scoop. That would be just the ride for West Texas interstates, now that the speed limit has been officially raised to 80 mph on more than 500 miles of freeway.
Photos courtesy of the manufacturers