Do we trust a GM petrol-head when they tell us EVs will take decades?

On one level, yes. Realistically the switch to EVs (electric vehicles), or whatever we switch to, won't happen overnight. Logic tells us that we will continue to consume petrol - and diesel - for years and years to come. But it will begin to fall. The shift will happen not because we are running out of oil - we've been 'running out' since we started getting it out of the ground - but because the price will rise. And rise it will, as world demand continues to grow in tandem with the increasing difficulty of extracting oil from deeper, dirtier and more difficult to reach reserves. Consumers will drive the switch to EVs (and other alternatives) when they see that the non-petrol vehicle is available at a comparable initial buy price, with similar utility. Simple, so we almost agree. "Decades" may be an exaggeration, but 2 decades of demand in a lop-sided bell-curve is conceivable with a sudden drop off then long tail into the future.

However what this statement really tells us is that GM's local arm is not serious about making the switch anytime soon. Indeed, they may be accused here of dampening down the prospect: Plug-in electric vehicles are decades away from replacing conventional cars in the garages of average Australians, according to Holden. It doesn't sound like a statement of commitment to change, does it? Even though Holden's is committed to the GM Volt it doesn't sound like they expect to sell many. Not soon, anyway.

So who is talking EVs down? None other than Holden's energy and environment director, Richard Marshall. Well he should know, eh? Sitting as we do on a mountain of coal, in a country with an avowed commitment to digging that coal out, generating electricity and burying the carbon somewhere deep, of course we wouldn't actually be interested in switching to EVs. Would we? Hmmm. We'd rather pump up our remaining, dwindling oil and gas reserves (OK, we do have lots of gas) and keep our cars running as they should - on petrol or diesel. Why talk up EVs when we can have what we have now, in spades? Oh yeah, but we'll have to import more oil just to keep up with current demand, let alone what we want in the future. Of course continuing to maintain the oil industry is best for the country. Why even think about EVs or other alternatives?

But I'm being a bit difficult, for Holden's Energy and Environment guy has other plans, too: "We need to do other things; we can't sit around and wait for electric vehicles to become cheaper," he said. "We need a multi-path approach." Can't argue against that, although EVs would seem high on that list. What Mr Marshall really wants to sell is the current fleet of cars (big, hungry Commodores) with an ethanol mix in the tank: Marshall said ethanol was an attractive option because fuel sources were widely available in Australia, it was affordable and it offered a "whole of life" reduction in CO2 of up to 94 per cent, depending on the fuel source.

Now that 94% "whole of life" reduction in CO2 is interesting. I wonder how that comes about? The GM Holden line of thought is that it is dependent upon source, and a few possibilities are provided: "It's a good cash crop which could provide more jobs and at the same time help to rejuvenate the soil and reduce carbon dioxide," he said. Sugar cane was also a ready source. "There's a good health argument to say that we'd be better off putting sugar in our cars than putting it in food," he said. Well that helps, doesn't it?

Maybe, maybe not. We do need to do something about human dietary sugar abuse, yes; and farmers will appreciate both a good revenue stream and improved soil. But how exactly does increased ethanol production and consumption reduce either the cost of fuel, or our overall atmospheric carbon dioxide emissions? If all we did was plant trees, granted we would be helping the environment by sequestering CO2 and lowering the water table, amongst other good things. But if we are planting trees only to harvest them in 5 or 10 years all we are doing is providing a small hope for the future, not a present solution. Ah, but that's where we make do with our excess sugar cane! Which is all very well but ethanol doesn't just spring forth from these plants and make its merry way to the gas pumps without some processing. Indeed by the time we have added the energy expenditure involved in ploughing and planting the crop (be it sugar cane or melaleucas), watering it, feeding it, processing it and then piping or trucking the ethanol to the storage areas where it can be mixed with petrol and then (again) piped or trucked to the gas pumps.. well we are probably behind in the carbon emission game, not ahead. And sugar cane is not the best way to make ethanol anyway, even if it did make sense.

All that we get out of ethanol, seriously, is a way to bolster the status quo, to fend off the inevitable. It would give GM Holden (and other local Aussie car makers) some breathing space in which they could continue to build the cars they build today without having to sink more money into new drivetrains and overall designs. What is not mentioned is that the taxpayer will again have to fund the inefficiencies inherent in this approach and continue to shore up these dinosaurian car makers. What will actually happen is that other car makers will take the initiative, jump into EV production, get the cars to market with leasing plans and innovative plug-and-play battery solutions that will allow consumers to make a choice. GM Holden is not willing to be the innovator, they don't want to lead, or to take a risk - they want someone else to do it. Instead they want to stick with the past, squeezing out the last possible drop of profit from their tired old ideas. If they are right and ethanol proves to be 94% more amazing than anyone ever thought, great, all power to them. But if they are wrong then they will effectively be handing the Aussie car market to the innovators. So nothing has really changed, has it?

Football, meat pies, kangaroos etc.. funny strange how it all links together #marketing #GM #rugbyleague

In my bizarre world it all makes sense. GM is a big US brand-accumulator that has taken over popular national car-making brands in several countries, such as Opel in Germany, Vauxhall in the UK and of course Holden in Australia. In doing so they have managed to either submerge the link with GM from public view, such as they have done with SAAB in Sweden, or use it to their advantage, as they did with the much grander-sounding General Motors-Holden's Ltd (since renamed). In this way GM has become huge, feasting on the success of brands both in the US and across the world. To complete the sleight of hand in Australia GM's advertising agency re-worded a very patriotic-sounding Chevrolet jingle that suited the US market to fit the Australian environment. That sort of pragmatic, yet shallow and empty marketing resonated with the public at the time, but to me has set the scene for what ultimately may be the end of the whole "as Aussie as a Holden" charade.

'Football, meat pies, kangaroos and Holden cars', goes the jingle. Ahhh, football. But which kind?

Well in Sydney, traditionally, it has been Rugby League, a professional working class spin-off from the proudly traditional 'amateur' code of Rugby Union. And of course Union is no longer amateur and the 'working class' League players (at least at the top end) are now as well off as any local pro sports star. As in very nicely paid, thank you. Which brings me to the whole system of competition, which has evolved over the last 20 or so years from a district-centred and loyalty-bound operation to a national comp where only the richest clubs can afford the best players and coaches (salary cap duly noted) and loyalty is largely meaningless, or very short-term. Yes, there are exceptions, in pockets of resistance (Souths and St George, perhaps, and maybe a couple of other clubs to varying degrees). But in essence the local developmental pathways that ensured local support have been eroded, leaving what remains of the loyal supporters clinging to a brand name rather than a meaningfully real entity. Whole clubs have been sacrificed at the altar of cash and flung into oblivion. Where those fans went I don't know - well actually I do, as I simply lost interest. Now I just look for the results, almost totally disengaged from any sort of active support. I won't be taking my kids to a game, I can tell you. Given the ill-disciplined attention seeking of these gifted but arguably over-paid "athletes", I'd rather they play - or watch - soccer instead.

OK, I know, that's professional sport these days. But some sports - cycling for example - have managed to merge the pros and the amateurs, retain the grass-roots club network and create a successful professional system without the same smell of filthy lucre. It doesn't help that the main financial underpinnings of Australia's Rugby League football clubs are the gambling dens of the leagues clubs and the money-hungry alcohol manufacturers.

Why am I thinking about all this? Well I read this statement:"I find it astonishing that someone would make those comments when they aren't even part of the NRL." That's someone from the Cronulla club (in financial peril and wanting to save themselves by playing a few more games 140km or more north at Gosford) having a go at someone who lives on the Central Coast but runs one of the clubs (Norths) that was outed from the national league some years ago. You can get all the sordid details at that link. Point is, Cronulla (itself a spin-off from the St George club) has about as much to do morally, ethically and culturally with the Central Coast as GM has to do with Holden. Perhaps even less, as at least GM rescued Holden's in the first place. Either way, it's all about money. They may spin a nice yarn, but I can't imagine anyone believing it. And as the 'astonished' Cronulla spokesperson said, if you aren't part of the national league, don't even bother commenting. The arrogance.

And in my bizarre world, that's the link. The short-term, dollar-focused arrogance with which consumers have been treated by the National Rugby League is akin to the ever-thirstier-and-ever-bigger car-making arrogance shown by GM. And we know where GM is right now - staring into the abyss.

Should we bother to save GM and brands like Holden and SAAB? #cars #meltdown

What will it take to save these giant auto-manufacturing dinosaurs, and should we bother?

GM, like Ford, has been on the brink for years, selling off assets to stave off the inevitable. Bad bets on dumb cars made in the face of rising fuel and resource prices have only compounded the problem - and now the financial crisis is hitting hard, forcing GM to consider bankruptcy and break-up. If the US government stumps up enough cash, it can be saved - but why? As an unemployment relief scheme, or as a going concern? Can it be a going concern again? Will saving it only preserve the bad investments and poor management that got it where it is today?

It's worthwhile to look at the overall industry. It's past mature, it's commoditizing. Relatively fresh, new brands from Asia are pumping out cheap cars that match - perhaps even better - what the old guard has been offering. These new brands are agile, and they are better prepared to adapt to new fuels and new ways. But these are game-changing times and competive threats will come from unexpected places as new players, armed with new ideas, attempt to leverage the chaos.

This is not a new problem and hardly a surprise. Manufacturing has largely shifted out of the developed world, and services dominate those economies. Big auto companies do represent prestige as well as jobs, though, and nations are reluctant to let them go. Politicians, in defence of subsidies for these doddering corporations often rely on a combination of prestige and the old-world thought of preserving these 'seeds' from which a war machine could be built. 'If we let go of this capability we may not be able to defend ourselves', goes the argument. However we need more than just heavy manufacturing to 'defend ourselves' these days. It's an argument that needs to be answered carefully, but the thought strikes immediately that we probably need diplomacy, trade and strong, positive relations with other nations as much - or more - than we need an auto industry. If you really believe that an auto industry is an essential building block that can't be lost, then you'd have to believe that of all industries - from clothing to agriculture, from electronics to aircraft manufacture - and seek to preserve all of them. But of course we don't, do we? In the end we are pragmatic, and seek to trade with other nations that are better suited to making these things. And instead turn to our own strengths.

Now GM is really a cluster of brands, rather than a brand of its own - which works to the good in a break up. It's not hard to imagine a fire-sale where the best bits are taken over by competitors. Whilst that may happen with Vauxhall and SAAB, less attractive is the Aussie GM brand, Holden. It's outdated, reliant upon subsidies and a long way from other markets. It could possibly be shrunk down to focus on some key competency, if you could determine which competency that may be. As I established some time ago, it's way off the mark in terms of competively manufacturing cars, even the "big Aussie cars" it claims as its heritage:

I have to tell you I was somewhat surprised at the estimated factory cost of the Alfa Brera. It must be wrong, surely? Somewhere my assumptions have gone awry, because seemingly the prestige European sports luxury car has a lower base cost per vehicle than the locally built sedan. But then I wondered if the still-somewhat protected nature of the small Aussie car manufacturing industry may have distorted the real cost of manufacture.

I'm not the only one to crunch the numbers, either: "The Australian government can throw $6 billion or $600 billion at these car plants, but they still won't be economically feasible," he said.

So if Holden goes on the market, who will buy it? The obvious choices will be the extant manufacturers in Australia, namely Ford or Toyota. Ford has its own problems of course, but buying out its traditional foe would surely be tempting, if only to close it down. After all, we don't need - and probably can't afford - 3 manufacturers in Australia. But Toyota is a more logical choice. But why should either bother? If no buyer can be found and Holden closes, the problem is solved. If anything's to be bought here at a decent price it will be brand name itself.

Which leads to a more efficient local industry - 2 manufacturers plus importers. Jobs will still be shed and many tears as well - the Holden name will not rest easily on the shoulders of either Toyota or Ford, after all. But will that be enough to prompt the Rudd federal government to dive in and "save" the company? For the sake of the nation let's hope not. Instead let's seize the day, support the workers in more practical ways and take action that improves the efficiency and sustainability of the industry. Before its all too late.

Ramifications - GM flogs SAAB, SAAB ditches Aussie-built engines #economics

Everything is connected in this globalised world. The cash-strapped and sinking fast General Motors Corp. has been knocked back by the Swedish government, so far, and is looking for financial support elsewhere - probably by flogging SAAB to the highest bidder. Now that's all very sad for SAAB but it appears likely that for various reasons, including fuel efficiency and the understandable urge to downsize, SAAB has ditched the GM-sourced and Aussie-built V6 engine (that also sits inside most Holden Commodores). There's a big dent in the Aussie engine export program (maybe they should have stuck with exporting 4-cylinder motors after all?).

This follows FIAT-owned Alfa Romeo, another Holden engine customer and former GM-playmate, recently ditching - or at least down-playing - the same V6 (well, the block, anyway - they use their own head) in favour of a new, high-tech and hyper-efficient 4-cylinder. FIAT and Alfa are planning to introduce what looks uncannily like an electro-hydraulic version of a desmodromic valvetrain that will get at least 2-litre performance out of 1.4 litre petrol engines without the extra weight and complexity of a hybrid powertrain.

Holden's had better get working on those 4-cyclinder motors, the sands are shifting fast.

Porky GM Commodore admits fat problem

Yes, well, we all knew it. They have a weight problem at GM. They make fat cars. So rather than get creative, they are doing things they shoulda/coulda done 10 or 15 years ago!

Holden is looking at removing the spare tyre from the Commodore and instead fitting controversial run-flat tyres as part of a broader plan to improve fuel efficiency by more than 20 per cent and reduce carbon dioxide emissions.

Oh please. And the proposed use of aluminium will reduce carbon emissions, too, eh? Frankly we need to stop reporting this rubblish. The real story lies with smaller, lower-footprint cars, not sustaining the unsustainable beasts.