Fisker buys former Pontiac and Saturn factory from GM

Fisker Automotive, a company that plans to begin selling an advanced plug-in hybrid luxury sedan next spring, agreed to buy the former General Motors assembly facility in Wilmington, Del., for $18 million. The Wilmington plant was used to make the Pontiac Solstice and Saturn Sky roadsters. Fisker said it was interested in the plant because of its size and its proximity to rail lines and a port.
 
The Obama Administration has talked a lot about its goal to develop jobs in the green economy to replace the traditional manufacturing jobs the U.S. has lost, specifically by building electric cars. An announcement today by Vice President Joe Biden marked the beginning of that process.
 
Fisker will spend an additional $175 million to retool the Wilmington facility to build a new plug-in model that is expected to cost about $48,000 before federal tax rebates. (Fisker’s first model, a luxury four-passenger sedan dubbed the Karma, is expected to cost almost $90,000. It will be built in Finland starting next year.) The company says more than half the production of the new model will be exported.
 
The $193 million investment came from a $528.7 million loan Fisker received as part of the $25 billion federal Advanced Technology Vehicle Manufacturing loan program (ATVM). The rest of the loan will pay for further development of the Karma and the Project NINA.
 
The new model, now dubbed Project NINA, is scheduled to begin production in 2014. Once the Wilmington factory is up and running, Fisker optimistically expects to produce 75,000 to 100,000 cars and employ 2,000 factory workers in Biden’s home state, as well as 3,000 supplier jobs.
 
—Eric Evarts

Auto X Prize Finalist: Amp Sky

In meeting several Progressive Auto X Prize finalists this week, it was clear that there are many ways to approach the $10 million challenge to develop a marketable car that can achieve a 100 miles per gallon equivalent (MPGe). On hand at the New York City event, Advanced Mechanical Products (AMP) shared their smart strategy for producing electrified cars: convert existing production models.
 
The general concept behind the Amp Sky, and eventually an undisclosed Chevrolet model, is to replace the internal-combustion powertrain with a battery-electric system. And the key here is that Amp is matching the original configuration pound for pound, therefore retaining the weight and weight distribution of the original donor car. The benefit is that General Motors has spent hundreds of millions developing the car, including brakes, suspension, and steering systems. By sticking within basic factory specs, the “Amplified” vehicles should perform in a similar manner and ease future servicing.
 
With the Saturn Sky, Amp removes the engine, transmission, and differential, replacing those components with about 900 lbs. of Valence lithium-ion batteries and motors. The result is a weight balance within one percent of the original car. Amp claims their changes retain similar crash performance as the original car. To keep the transformation discreet, Amp routes the electric powertrain information to the existing instrument panel. Aside from badging and lack of exhaust pipes, one would be hard pressed to identify a parked Amp Sky from a gasoline-fueled model.
 
The two rear-mounted motors can accelerate the car “quicker than the original.” Published company estimates for 0-60 mph times range from six to eight seconds. Top speed is 90 mph. Based on usage, Amp figures 150-mile range per charge – much farther than the average commuter drives daily. Recharging fully drained batteries would take 3.5 hours, though a typical day may require just 1.5 hours from a 220-volt outlet. The company estimates its MPGe rating to be 125.
 
Amp is accepting preorders on the Sky, and the conversion cost is $25,000 plus a donor car. The batteries and motors are warranted for three years, 36,000 miles, and the company predicts the batteries will retain 80 percent of capacity at 100,000 miles.
 
 —Jeff Bartlett

Learn more about the Automotive X Prize competition. And find out more about driving green in the Consumer Reports special fuel economy section.

Should I buy a Saturn car?

General Motors stopped building Saturn cars and SUVs immediately following the announcement that Penske Automotive Group would not to buy the rights to the brand. GM now plans to sell off the remaining 12,000 Saturns by the end of January 2010, shutting down the brand, much like it is with Pontiac right now. Saturn dealers are watching the calendar closely, and it is a safe bet that there will be significant incentives offered on these last vehicles. But should you purchase a Saturn now? In a word, no.
 
There are five Saturn models for 2009, but only the Aura has both performed well enough and been reliable enough to earn our Recommendation. (See all Recommended cars.)
 
Beyond our assessment of the product line, buying from a retiring brand carries certain inherent risks. For instance, upfront savings will most assuredly be offset by significant depreciation. (If you typically drive your cars into the ground, this may not matter much.) It is not uncommon to see GM vehicles carry $1,500 or more in rebates. How much more will they put on the hood to move the Saturns than the nearby Chevrolets? Another one to two thousand? It is very safe to assume the same amount is cut from the eventual trade-in value right from the start. We saw this with Oldsmobile and are witnessing it with Pontiac. Same will hold true for Saturn; it isn’t that different of a car company in the end.
 
General Motors has said it will honor Saturn warranty claims, maintenance, and repair needs at other, surviving GM franchises. However, best corporate intentions won’t make those dealerships more convenient, better stocked with parts, or better trained.
 
As we found in our investigations during the so-called auto crisis, while dealerships may perform work on models from other brands, there are practical limitations to parts inventory and technician training. Simple work like a routine service call is not a problem. For example, a Chevrolet mechanic who works on a Chevy Traverse or Malibu will find a Saturn Outlook or Aura familiar, they may not have the experience to tackle a problem with the Opel-sourced Astra or the low-volume Sky roadster. In such cases, even a warranty request would be deferred to another dealership.
 
Would you be able to fix a Saturn for years to come? Absolutely. It just may not be as convenient or inexpensive as in years past. What once may have been a quick service visit before work may require a day off work to travel to a neighboring town or county. And the likelihood to needing a repair is higher than average with the Outlook, Sky, and Vue, according to our reliability surveys.
 
In theory, parts will remain available, yet with the supplier network struggling during the recession and many vendors closing or going through bankruptcy proceedings, there are no guaranties. Parts that were once stocked by your local Saturn dealership may become scarce. Despite GM assurances about parts availability, remember that just last month, we all thought Saturn would continue for many years to come. Hard to say definitively what a Saturn ownership experience will be like in the next decade.
 
As always, consumers should enter the buying process with eyes wide open. With Saturn, there are simply better alternatives that are more reliable, have lower owner costs, and do not carry undue risks.
 
—Jeff Bartlett
 
Related:
Unplugged: Saturn dealerships to close in four months
No Penske deal means end of the road for Saturn

Unplugged: Saturn dealerships to close in four months

Within hours after the collapse of the agreement to sell Saturn last week, General Motors built its last Saturn. GM says it plans to sell the remaining 12,000 cars on dealers’ lots by the end of January 2010. (Read “No Penske deal means end of the road for Saturn.”)

Saturn has been known for its customer-friendly dealerships, but when they sell their final cars, it will mark the end of the vaunted Saturn dealer network, following Pontiac into the history books.
 
General Motors has said that other GM franchises will be able to service Saturns and will honor Saturn warranties. But some Saturn owners have reported problems with other GM-brand dealerships not having parts or training to work on Saturns and not having access to Saturn’s computer system for warranty repairs.
 
If it’s going to sell 12,000 cars in four months, GM will likely offer sizeable incentives to buy them. But of the five Saturn models for 2009, only the Aura XR V6 performed well enough and was reliable enough to earn our Recommendation.
 
Our earlier concerns about what the future might hold for those buying a vehicle from a discontinued brand remain. (Read: “Should you buy a Hummer, Saab, or Saturn?”) Even with significant incentives, buying a Saturn now carries additional risks and there are simply better alternatives from other, more stable brands, including those within the remaining GM portfolio.
 
—Eric Evarts

No Penske deal means end of the road for Saturn

General Motors has announced that it will wind down its Saturn division, rather than sell it. GM had been in negotiations to sell Saturn to the Penske Automotive Group, a dealer conglomerate run by auto racing magnate Roger Penske.
 
The move reportedly comes after Penske was unable to secure new products beyond the proposed contract with GM to continue building Saturn cars through 2011.
 
The news may be a blow to current Saturn owners who now may face the closure of all Saturn dealerships and will have to find other GM dealers to service existing vehicles.
 
The breakdown of this deal marks the latest failure of the dedicated contract manufacturing business model in car sales. Since several large dealership groups have incorporated as public companies over the past dozen years, several of these dealer bodies have looked for an automaker with excess factory capacity to build cars for it. So far, none have borne fruit.

Among the Saturn Astra, Aura, Outlook, Sky, and Vue, only the Aura XR V6 meets Consumer Reports' standards to be recommended.

Sadly, Saturn is sharing its fate with Pontiac. We will watch with interest to see what the future holds for Hummer and Saab.

—Eric Evarts

GM pulls the plug on Buick plug-in hybrid

General Motors has again delayed its upcoming hybrid. Initially, it was slated to be a new full-hybrid version of the Saturn Vue, using a smaller, lighter version of the two-mode hybrid system. It was also originally supposed to be GM’s first plug-in hybrid electric vehicle, potentially preceding the Chevrolet Volt by about a month.

When the company declared bankruptcy this summer, it abandoned its Saturn division and announced that the two-mode, plug-in Vue would become a Buick—a move that would delay its introduction by as much as a year. (Read: "Preview: Buick plug-in hybrid SUV.")

Now GM says the car was not well received in a preview of upcoming models. Consumers and media writers apparently told the company the car didn’t have “the premium characteristics customers have come to expect from Buick.”
 
Now the company says it will cancel the model, and apply the hybrid powertrain to another unspecified model.
 
Whenever, and whatever that is, we’re eager to sample it. We were impressed with the two-mode hybrid system when we tested it in the Chevrolet Tahoe in 2007. It boosted the Tahoe’s fuel economy by almost 36 percent. Unfortunately, we found basic Tahoe features and underpinnings uncompetitive with other full-sized SUVs.
 

Meanwhile, we like the Chevrolet Malibu. But when we tested the Malibu Hybrid, we were unimpressed with its rudimentary hybrid system; it yielded a mere 8 percent improvement in fuel economy over the basic four-cylinder Malibu—and none on the highway.

So, how will the new plug-in eventually measure up? We look forward to finding out, and before then, discovering what vehicle will receive the orphaned powertrain.

—Eric Evarts

Cash for clunkers: American cars

The “Cash for clunkers” program intended to jump start auto sales is in full gear. The Car Allowance Rebate System (CARS) allows consumers to trade in their gas guzzler for an instant credit toward the purchase of a more fuel-efficient vehicle based on specific qualifications.

All automakers are hoping to benefit from the potential sales surge. In particular, Chrysler and GM could benefit from a sales boost to coincide with their exit from bankruptcy.

If you are considering junking your old car and want to buy from an American brand, then check out our list of domestic vehicles that qualify for the Car Allowance Rebate System (CARS) program. All models listed are also Consumer Reports recommended, which means they must have performed well in Consumer Reports' tests, have average or better reliability, and, if crash-tested, provide good overall safety. In addition, we list the owner cost score, which factors in depreciation, fuel, interest, insurance, maintenance and repair, and taxes over the first five years. A much more detailed view of owner costs, for three, five, and eight years as well as full ratings, reliability, safety and more are available in the model overviews for each new car (available to online subscribers).

For comparison, we have included the overall mpg from Consumer Reports’ tests to illustrate real-world fuel economy numbers. To judge the benefits from making a switch, we used these figures to calculate the annualized fuel costs based on 12,000 miles a year at an average price of $2.50 a gallon for gas. We assumed the trade-in vehicle had 18 mpg. If the overall EPA mpg is less, then the fuel savings would increase. (Compare your fuel economy scenario.)

Make & model	EPA mpg	CR's overall mpg	Annual CR fuel costs	Minimum fuel savings	Cost of ownership score (1-5 years)
Chevrolet HHR	24	24	$1,250	$417
Chevrolet Malibu (4-cyl.)	26	25	1,200	513
Ford Escape (4-cyl.)	21	21	1,429	238
Ford Escape Hybrid	28	26	1,154	595
Ford Focus	27	26	1,154	556
Ford Fusion (2010)	25	24	1,250	467	N/A
Ford Fusion Hybrid (2010)	39	34	882	897	N/A
Ford Mustang	20	20	1,500	167
Ford Taurus	21	18	1,667	238
Lincoln MKZ	21	20	1,500	238
Mercury Mariner	23	21	1,429	362
Mercury Mariner hybrid	28	26	1,154	595
Mercury Milan	23	21	1,304	362
Pontiac Vibe	28	29	1,034	595
Saturn Aura XR V6	20	20	1,500	167

For more information about the program, visit our Cash for clunkers special section.  To get advice on whether it is the right time to buy a new car, see our post Is Cash for Clunkers for you? Visit our New car buying and leasing forum to share your experience and give advice to others making the trade.

—Liza Barth

Also read:

Cash for clunkers: Recommended cars that qualify for a voucher
Cash for clunkers: The best gas guzzlers to junk
Cash for clunkers: Compare the fuel savings
Cash for clunkers: Fuel and owner costs
Cash for clunkers bill cuts fuel consumption–running the numbers

Should you buy a Hummer, Saab, or Saturn?

Buying from these three orphans of the General Motors bankruptcy process carries newfound consumer risks, making it difficult to endorse buying their vehicles right now. Further, there are just three models between them that meet Consumer Reports standards to be recommended: Saab 9-3 sedan, Saab 9-5, and Saturn Aura XR V6. And of those, the Saabs are decidedly dated cars overdue for a redesign.

While Hummer, Saab, and Saturn are not part of Motors Liquidation Company, where the so-called bad assets from the former GM corporation are staged, these brands are pending imminent sale or other resolution. Think of them as the kids who didn’t make the varsity team. They may get picked for junior varsity, or simply sent home.

Each brand has a likely purchaser lined up (Hummer – Tengzhong, Saab – Koenigsegg, Saturn – Penkse Automotive Group), though the deals have not been finalized. We can report on the current vehicles and state expectations that parts, service, and warranties will be honored by the next owners. But the reality is, we don’t know for sure what the future holds. Do you want to gamble with your own money, even though incentives are likely to be high?

Another factor is the dealer body. Many dealerships have closed under the weight of the recession, while others will be relinquishing their franchise rights when they expire. Hummer, Saab, and Saturn dealerships are not nearly common as Chevrolet stores. If the local dealership closes, how convenient would it be to visit another? And, what if the new owners withdraw from your region, choosing instead to focus on areas that would maximize per-store volume?

Plus, there is an underlying concern for consumer protections with lemon law and personal injury claims, as reported previously with Chrysler and GM.

The bottom line is that there are significant unknowns that add risks to buying what are in most cases mediocre vehicles. If your heart is set on purchasing from these brands and you are looking from a great deal, I suggest you wait a few months to see how the ownership situation shakes out.

Read: "What the post-bankruptcy GM means to you."

—Jeff Bartlett

Car brands: Who owns what?

The auto industry is very complicated these days, with constant change across all corners of the globe. The worldwide economic slowdown dictates widespread cost reductions, inspiring partnerships and changes in ownership. Further confusing the scene are past commitments between companies: For example, the new 2011 Jeep Grand Cherokee is based on a Mercedes-Benz platform–even though Chrysler and Mercedes are no longer joined at the hip.

To help clear up some of the confusion, here is a road map to navigate who owns what brands among the major companies that sell in the U.S. car market.

BMW owns: BMW, Mini, and Rolls Royce

Fiat owns: Alfa Romeo, Ferrari, Fiat, Lancia, Maserati; Chrysler, Dodge, Jeep–20-percent stake

Ford Motor Company owns: Ford, Lincoln, Mercury, Volvo (for now), and still owns 13.4 percent of Mazda

General Motors owns: Buick, Cadillac, Chevrolet, GMC. Also owns a controlling interest in Daewoo, as well as Opel and Vauxhall in Europe and Holden in Australia. (Pontiac to be discontinued)

Honda owns: Honda, Acura

Hyundai owns: Hyundai, Kia

Tata Motors (India) owns: Jaguar and Land Rover

Mazda (partially owned by Ford)

Mitsubishi

Daimler AG owns: Mercedes-Benz and Smart

Nissan owns: Nissan and Infiniti (Nissan is owned by Renault--France)

Porsche owns: Porsche and a majority share in Volkswagen

Subaru (A controlling interest of Subaru is owned by Toyota)

Suzuki

Toyota Motor Company owns: Lexus, Toyota, Scion, Daihatsu and Hino Motors, with a stake in Fuji Industries (Subaru’s parent company) and Isuzu

Volkswagen owns: Audi, Volkswagen, Bentley, Bugatti, Lamborghini, and overseas SEAT and Skoda.

In formal negotiations to be sold:
Hummer: Tengzhong (China)
Saturn: Penske Automotive Group
Saab: Koenigsegg (Sweden)

--Liza Barth

GM car warranty confusion leaves consumers and dealers in the dark

Despite assurances from General Motors President and CEO Fritz Henderson that “We have absolutely no intention at all of not taking care of customers" (from CBS Early Show interview), there is one thing that is clear about vehicle warranties during the GM bankruptcy: There is confusion.

In posts on January 6 ("Who will perform warranty service on my GM car?") and another one on June 2 ("My dealer closed! What do I do?"), we reported that GMs instructions for Saturn owners needing warranty service are very clear:

"Under the terms of the warranty, the customer should first attempt to bring their vehicle to any Saturn retailer for warranty service. If there is no retailer in their immediate area, or if it is an emergency situation, the repair can be made at any General Motors dealership. In non-emergency situations, it is a good idea for a customer who is having trouble finding a nearby Saturn retailer to call Saturn Customer Assistance before going to a non-Saturn location. That number is (800) 553-6000."

However, not everyone has received that message.

GM confirmed to us that it “…received Bankruptcy Court approval on June 1 to honor all warranty programs related to vehicles and related components, which also includes lemon law claims, field actions/recall costs and buyback activities.” Additionally, GM's warranty coverage is backed by the U.S. Government for passenger cars and trucks purchased on March 30 through July 31. 

But there are still challenges for motorists seeking warranty repairs. For instance, some Saturn dealerships are going out of business due to the economy, and yet others are deciding not to sell Saturns and service them under warranty. In addition, it appears that internal policies limit–and may even prevent–non-Saturn GM dealers from servicing Saturn vehicles.

According to David Henson, founder of Warranty Matters who provides multi-brand warranty auditing and training services, the GM Policy and Procedures Manual has specific language that limits cross-brand service work. For example, a Chevrolet dealer can work on a Pontiac or Saturn vehicle, if the dealer either sold it as a used vehicle or it was considered an emergency repair situation. Participation in the cross-brand work is not mandatory, says Henson, as dealers might not have the training or tools required to diagnose and properly repair the vehicle.

As a GM spokesperson explained, a Saturn dealer may not be equipped to perform complex repairs on a Corvette, or vice versa. And the term “emergency” is open to interpretation by the local service manager.

Todd Ingersoll, president of Saturn of Danbury and Watertown (Conn.), confirmed the rule, saying it is “General Motors’ policy to allow any division to fix any General Motors car in an emergency, or if they sell the vehicle as a used car.”

A GM representative explained that service for vehicles from the four discontinued or otherwise disposed of brands will continue to be provided by any Hummer, Pontiac, Saab, or Saturn retailer—again, assuming they are still around. GM confirms the policy is that in emergency situations, these vehicles can be serviced at any GM dealer.

Other dealers we spoke with were not as clear on the policy. Adding to the uncertainty is that General Motors currently uses three different warranty management and parts ordering systems: one for Saturn, one for Saab, and one that covers the remaining brands. This makes is difficult for non-Saturn dealers to order the correct parts for Saturn vehicles, according to Henson.

Overall, the confusion hurts the consumer and may even sour them on buying from the “new” General Motors. Likewise, dealers may be turning away business unnecessarily.

It is a shame, as GM has assured us that “There will be an adequate supply of parts to service vehicles, including vehicles associated with discontinued brands.  As brands/models are phased out, GM will continue to provide service parts based on the total number of vehicles on the road, customer demand for parts, and estimated needs for future parts.”

Mark LaNeve, GM North America vice president - Vehicle Sales, Service and Marketing, said, “We're standing behind our products, we're honoring our vehicle warranty programs, we have an adequate supply of service parts for all products and our dealers stand ready to provide great service. Putting our customers first remains a primary focus every day."

The message from General Motors is good and consistent, but it needs to be clearly communicated to the local level. Since our investigation began, Janine Fruehan Manager, Quality & Safety Communications, has assured us that just such a message is being prepared.

We are calling on General Motors and the Auto Task Force to issue a statement that makes it clear to all GM dealers and consumers that owners can take their Hummer, Pontiac, Saab, and Saturn vehicles to any GM dealer for service, even if the car was not purchased at that dealer or not an emergency situation. Clear communication would help all parties.

In the meantime, we recommend car owners call ahead and confirm with a service manager that warranty work will be performed. If one dealer refuses, call another.

For further information, visit: www.gm.com/restructuring/

Read "What does the GM bankruptcy mean to you?" To get more answers to the most common questions and concerns about GM’s bankruptcy, visit our Auto Crisis hub.

—Jon Linkov