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GM won't pay owners of recalled cars for lost value

Kenneth Feinberg, the man in charge of the General Motors compensation fund dealing with the its widespread ignition switch woes, has issued an informal, two-letter response to the plaintiffs in more than 70 lawsuits seeking redress for lost resale value of their Cobalts: "No." The cases were recently combined into one, but Feinberg told The Detroit News that the fund will deal "only with death and physical injury claims," and that "perceived diminished value" will get no consideration.
ALG, the firm specializing in establishing residual values, determined that Cobalt owners had lost $300 compared to the segment competition and doesn't envision any long-term effects from the recall situation. Feinberg's statement comes in advance of public details on how the compensation fund will work and adheres to GM's long-held position on the matter. The company has already asked a judge to throw out such suits using the pre-bankruptcy defense, even as it stopped using that defense in cases of injury and death.
With plenty of potential gain from the GM suit, however, don't expect the plaintiffs to give up yet. When Toyota was sued for the same reason during the unintended acceleration debacle, it eventually settled the case for between $1 billion and $1.4 billion just to get it over with. Since the 85 law firms involved in the Toyota litigation took home more than $250 million of that total, we shouldn't expect the attorneys to give up on a GM payout, either.

2016 Chevy Volt will not need premium gas

Buried in the new technical details of the 2016 Chevy Volt released yesterday was a throwaway line about a small but important change that's due to the new 1.5-liter, four-cylinder engine. The first-gen Volt has always required premium gas but the new powerplant will be happy burning plain old regular. The Volt's chief engineer, Andrew Farah, told AutoblogGreen that the change was due to today's Volt owners explaining they were not happy paying for top-shelf petroleum. "The ability to use regular unleaded was based directly on customer feedback," he said. "Since the range extender is an all-new engine, it was optimized to use regular unleaded at the outset. Using regular fuel will not have effect on vehicle acceleration or other performance factors." As Larry Nitz, GM's executive director of vehicle electrification, told AutoblogGreen yesterday, the new engine is more powerful and quieter than the outgoing 1.4-liter engine that's used in the current Volt. Fuel economy and EV range specs for the next-gen Volt are not expected until the full car is revealed at the Detroit Auto Show in January.

GM to idle car production at five factories as Americans continue CUV love affair

In case you needed another reminder that Americans have fallen out of love with sedans, General Motors today announced plans to idle five factories in January in a bid to cut its inventory to 70 days. Detroit-Hamtramck Assembly ( Buick LaCrosse, Cadillac CT6, Chevrolet Volt and Impala) and Fairfax Assembly in Kansas ( Chevy Malibu) will stop production for three weeks. Lansing Grand River ( Cadillac ATS and CTS, and Chevy Camaro) is going down for two weeks, while Lordstown, OH ( Chevy Cruze) and Bowling Green, KY ( Chevy Corvette) will go idle for a week each, Automotive News reports. GM's shutdown reflects a broader problem with the company's supply – at 847,000 vehicles, the company's supply increased unsteadily from a low of 629,000 units in January of 2016. That's more than a 25 percent increase in the past year. Citing information from Autodata, The Detroit News reports that at the end of November, GM had a 168-day supply of LaCrosses, 177 days' worth of Camaro, 170 days of Corvette, 121 days for Cruze, 119 days for ATS, 132 days for CTS, and 110 days of CT6. Meanwhile, inventory of the company's more popular vehicles is actually below the professionally accepted 60- to 70-day supply, The News reports. The Trax, Colorado pickup, and GM's full-size SUVs are sitting below 50 days and experiencing year-over-year sales increases. GM needs a rethink of its inventory levels, which is something that's apparently coming. "We're going to be responsible in managing our inventory levels," GM spokesman Jim Cain told The News. Another unnamed spokesman told Automotive News the company's day-to-day supplies would "fluctuate before moderating at year-end." But at least one analyst thinks this won't be the last time Detroit needs to stop production to level things out. "Incentives are elevated, residuals are declining, and rates are rising," Brian Johnson, an analyst with Barclays, told The News. "And while GM in particular may benefit in the months ahead from new product launches, it's important to recognize that GM's inventory is elevated at the moment, and it wouldn't surprise us if they need to announce another production cut – which could pressure the stock." Related Video: News Source: The Detroit News, Automotive News - sub. req.Image Credit: Paul Sancya / AP Plants/Manufacturing Buick Cadillac Chevrolet GM GMC Crossover SUV Sedan bowling green cadillac xt6 fairfax