Automakers Focus On Mileage, Increased Profits

Anthony Fontanelle
September 11, 2007

At this year’s International Auto Show, auto giants unveiled vehicles that mirror the industry’s color – GREEN. Green for environment-friendly vehicles. Also, green for profitability.

Automakers introduced improved fuel efficiency and engines that run on hydrogen or batteries. The goal is to enhance mileage and respond to the increasing global warming concerns. At present, improving gas mileage is one of the hot issues tackled by the lawmakers. Moreover, it is expected that the industry should comply with the stricter standards after the passage of such legislation.

Another focus of the automakers is to return to profitability. After the debilitating sales doldrums, who would not strive to be back into the black? Amid the strong European and global economies, most of the auto giants have posted sales declines. This is why they are making the most of every effort to push their company into profitability.

Whether it's the threat of government regulation on both sides of the Atlantic or growing consumer interest, auto companies have given the show an environmentally conscious flavor, even when it comes to larger vehicles such as BMW's X6 SUV-car crossover, reported International Herald Tribune.

"We're not just talking about cutting CO2 emissions, we're doing it," said BMW Chief Executive Officer Norbert Reithofer, after the Bavarian automaker unveiled the X6, a ‘sport activity’ vehicle with a hybrid engine that will be on sale in 2009. "This isn't just a quick, halfhearted effort. We've been leading the way for years. We got an early start and it's not at all the case that we're being pushed into this by politicians."

For other auto giants, the notion is taking root deeper into future planning and execution. General Motors Corp. Vice Chairman Bob Lutz said that the American automaker aims to develop an entire line of electric cars that could share parts used by gasoline-powered counterparts.

GM head honcho said that the Detroit-based automaker would likely have its E-Flex platform serve as a base for future development. The system, used in its just-debuted Flextreme concept car, has a small diesel engine generator to charge a lithium-ion battery pack.

GM hybrids such as the Saturn Vue, Saturn Aura and the Chevrolet Malibu are expected to reach 10,000 sales by the end of the year and will continue to play a crucial function in the automaker’s growth. The Saturn window motors could be pulling some positive shopping energy.

Ford Motor Co., meanwhile, said that it will have three models with lower CO2 emissions available in Europe by the end of 2008. The Dearborn-based automaker is working on diesel versions of the Focus, Mondeo and a new subcompact with innovative technology to lessen emissions. All three vehicles will carry the ECOnetic badge of the automaker.

Renault SA Vice President Michel Gornet, however, said that consumers have a limited appetite for paying extra for environmentally friendly technology. "The consciousness is there," he said. "Renault is focusing on designing more environmentally efficient engines across all its models.”

Nissan Vice President Carlos Tavares said that the automaker is not concentrating on any specific environmental system. "We won't bet the future of the company on a single technology," he said.

In the midst of the environmental drive, automakers also touted improved sales. According to the report, DaimlerChrysler AG CEO Dieter Zetsche said that the chance of a fatter shareholder dividend was better than before. Audi AG, on the other hand, said that it hopes to sell a record 950,000 cars this year and also hopes to beat last year's net profit. Additionally, Porsche AG said that its sales increased 3.4 percent during its recently ended fiscal year, pushed up by rising demand for its luxury cars.

Source:  Amazines.com