Auto Leasing Getting More Difficult

The auto leasing business is facing huge loses due to high gas prices reducing the values of SUVs and trucks. Last week, Chrysler Financial announced it will totally abandon lease financing. This forces Chrysler, Jeep and Dodge dealers to find other banks to finance their leases. GMAC will no longer offer leasing incentives on automobiles sold in Canada. Ford Motor Credit is decreasing the residuals in its leases to make them less attractive and to reduce their financial risk. Values for used light trucks have dropped by 30 percent over the last year. With a lease, the consumer pays the amount of expected depreciation over the lease term (typically 3 to 4 years). The lease company incurs a loss when the forecasted residual value is less than the vehicle value at lease end.

Source MSNBC

Saturn Vue Plug-In Development Progressing

The Saturn Vue Plug-In Hybrid is approved for production and development is progressing. Eleven of the Vue plug-Ins are being tested with lithium-ion batteries. Later in 2008, sales of the 2009 Vue Two-mode Hybrid will begin. The Two-mode hybrid system is based on the system currently available on the Chevy Tahoe and GMC Yukon. The Plug-In version will be available in a few years.

Source GM FastLane Blog

Electric Mini in 2009

BMW’s Mini brand will have electric cars on U.S. roads by the summer of 2009. Mini is still deciding whether to lease or sell the cars and where they will be sold. No estimate on how far the electric car will go on a charge. Mini is having a phenomenal year with U.S. sales up 34% due to high gas prices.

Source CNN Money

One Benefit of High Gas Prices, Auto Deaths Decline

A new study shows that deceased driving, due to high gas prices, can reduce auto deaths by a third. The biggest benefit is decreased driving by high risk teenage drivers. The study, by Michael Morrisey of the University of Alabama and David Grabowski of Harvard Medical School, showed every 10% increase in gasoline prices reduced auto deaths by 2.3%. With gas now at $4 a gallon, Morrisey expects a drop of 1,000 deaths a month.

Source USA Today

Solar Panels Will Be Available on Next Gen Prius

High end models of the next generation Toyota Prius Hybrid will have solar panels on the roof. The amount of electricity produced by the panels will be small and will only be enough to assist in powering the air conditioning system. The third generation Prius is expected next year.

Source MSNBC

55 MPH Speed Limit Making a Comeback

With gasoline at an all time high, lawmakers are looking to bring back the 55 MPH speed limit. Senator John Warner wants the Energy Deportment to study what speeds cars are most fuel efficient and how much fuel would be saved. In 1974, a 55 MPH speed limit was imposed by Congress in reaction to the Arab oil embargo. It was repealed when gas dropped near $1 a gallon back in 1995. The lower speeds save fuel and reduce highway fatalities.

Source WCBS

BMW Opposes New Fuel Economy Rules

BMW submitted a comment of opposition to the NHTSA over the 2011 Corporate Average Fuel Economy (CAFE) standards. The new standard calculates the fuel economy a vehicle needs to get based on the size of the vehicle. So a small car will need to get better fuel economy that a large pickup. BMW currently sells high performance luxury vehicles. Safety and luxury features add weight. Their entire lineup is rear or all wheel drive and the smallest engine is a six cylinder. BMW claims that the 2011 standards will encourage auto makers to increase the size of their vehicles to minimize the efficiency increases they need to make. This CAFE issue will be a mute point if gasoline stays above $4.00 because then it will be consumers not regulation forcing higher efficiency.

Source Automobile