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Dealers mobilize to protect their margins from automaker subscription services

Six individual auto brands — Lincoln, Cadillac, Porsche, Mercedes, BMW and Volvo — have established or are trialing a vehicle subscription service in the U.S. Three third-party companies — Flexdrive, Clutch and Carma — run brand-agnostic subscription services. And three automakers — Mercedes-Benz, BMW, and General Motors — have also launched short-term rental services. Dealers, afraid of how these trends might affect their margins, are building political and lawmaking campaigns to protect their revenue streams. So far, three states are investigating automaker subscriptions, and Indiana has banned any such service until next year. It's certain that those three states are the first fronts in a long political and legal battle. Powerful dealer franchise laws mandate the existence of dealers and restrict how automakers are allowed to interact with customers to sell a vehicle. On top of that, Bob Reisner, CEO of Nassau Business Funding & Services, said, "Dealers and their associations are among the strongest political operators in many states. They as a group are difficult for state politicians to vote against." In California earlier this year, the state Assembly debated a bill with wide-ranging provisions to protect against what the California New Car Dealers Association called "inappropriate treatment of dealers by manufacturers." One of those provisions stipulated that subscription services need to go through dealers, but that item got stripped out when dealers and manufacturers agreed to discuss the matter further. In Indiana, Gov. Eric Holcomb signed a moratorium on all subscription programs by dealers or manufacturers until May 1, 2019, to give legislators more time to investigate. Dealers in New Jersey have taken their campaign to the state capitol, asking that the cars in subscription programs get a different classification for registration purposes. Automakers run the current subscription services and own the vehicles. Sign-ups and financial transactions happen online or through apps, leaving dealers to do little more than act as fulfillment centers to various degrees, with little legal recourse as to compensation amounts when they're called on to deliver or service a car. That's a bad base to build on for business owners who've sunk millions of dollars into their operations.

First Cadillac ELR rolls off the line

Gearing up for the Belle Isle Grand Prix this weekend, General Motors invited some of the Chevrolet and Cadillac racecar drivers out to its Detroit-Hamtramck assembly plant. While there, the racers - including IndyCar Driver and Chevrolet Volt owner, Simona De Silvestro - witnessed the very first 2014 Cadillac ELR to roll off the assembly line.
These vehicles are not destined for customers, however, but instead pre-production units will be used by engineers for testing purposes. Actual production of ELR consumer models is expected to commence closer to the end of this year. As a refresher, this range-extended electric Cadillac shares much of its powertrain with the Volt but will have a sportier coupe design inspired by the Converj Concept. De Silvestro manged to snap a few images of here own, which you can see in the gallery below.

GM intends to offer semi-autonomous vehicles by 2020

Prepare for a few years of technological saber-rattling, as the world's automakers begin pushing to bring self-driving cars to market. Earlier this week, Nissan announced that it aims to offer autonomous vehicles by 2020, while Google, BMW and several other marks are working on similar efforts.
General Motors is doing things differently, though. Rather than push for a fully autonomous car, it's continuing to refine its semi-autonomous Super Cruise, a product that we tested in April 2012 and that will eventually see use on some Cadillacs before trickling down to the rest of the General Motors family. Super Cruise, which is undergoing testing in the Cadillac SRX, doesn't take complete control out of the driver's hands. Rather, under a very specific set of circumstances on the freeway, it will marry the capabilities of things like lane departure warning and adaptive cruise control to allow the driver to take their hands off the wheel. All of which sounds a lot like the system Mercedes-Benz is launching on the 2014 S-Class.
The system is still in development, according to John Capp, GM's director of electrical controls and active safety technology. Now that that the biggest hurdle, steering control, has been cleared, GM's engineers can focus on things like teaching the system to adapt to differing road conditions and visibility levels. As we reported in 2012, Super Cruise is still befuddled in low-visibility situations or when road markings aren't particularly clear.