Wednesday, October 31, 2012

Mercedes, BMW, and the once-despised Detroit ... - Automotive News

JAMES B. TREECE

October 30, 2012 - 2:26 pm ET

A report in today's USA Today says automakers are using new technologies to reduce the number of gas guzzlers on the road.

In case you've forgotten, "gas guzzler" is not just a generic slap at cars that get lousy mileage. It's very nearly a legal term.

The phrase refers to cars (trucks are exempt) with mpg numbers that are so egregiously bad that their makers have to pay a fine: the so-called federal gas-guzzler tax.

The tax, enacted as part of the Energy Tax Act of 1978, entails fines that escalate depending on a car's fuel economy. A car that is rated at a combined city/highway 22.5 mpg or better pays nothing; one rated at less than 12.5 mpg pay $7,700.

Most American and Japanese automakers built cars that, with a few exceptions, easily avoided the gas-guzzler tag and tax. Part of that was due to their desire to sell a good number of small cars so that, under the corporate average fuel economy rules, they then could sell more-profitable large cars.

But those companies also viewed the prospect of being labeled makers of gas guzzlers as only a few steps above having a "spouse abuser" sign posted on their front lawns. It wasn't the public image they wanted.

German and other luxury brands, though, took a different approach. With few small cars in their stables (until recently), they basically viewed the gas-guzzler tax as a cost of doing business. Rather than improve their cars' behavior in the fuel-economy realm to comply with CAFE, they simply shrugged at the potential negative implications for their image, paid the fine and passed the cost along to their customers.

In that sense, they were similar to the Detroit Pistons professional basketball team of the late 1980s.

Most hoops teams treat fouls as something to avoid: a player whistled for six fouls is out of the game, so the ideal is to commit four or fewer and stay out of foul trouble.

The Pistons saw that six-foul per player rule not as a limit, but as a quota. And if each player didn't use his full quota every game, the team wasn't getting its money's worth out of that player.

The Pistons played a particularly, uh, physical game. Outside of Detroit, it was reviled as a nasty, sometimes dirty team. But the team of Bill Laimbeer, Isiah Thomas, John Salley, Dennis Rodman, Rick Mahorn et al. didn't care. They embraced their nickname, the Bad Boys, figuring it intimidated opponents.

Now, says USA Today, the number of automotive Bad Boys is dropping. Mercedes-Benz will have only eight nameplates that have to pay the gas-guzzler tax in 2013, down from 17 in the 2010 model year, the newspaper reports. Killing Maybach helped.

BMW and Audi have trimmed their gas-guzzler ranks, too, sometimes by replacing a thirsty V-8 with a turbocharged V-6, or adding an eight-speed transmission, or tapping some other technology.

If this keeps up, the term "gas guzzler" may become as dated as "Bad Boys."

You can reach James B. Treece at jtreece@crain.com.

Source: http://www.autonews.com/article/20121030/BLOG06/121039982/mercedes-bmw-and-the-once-despised-detroit-pistons

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