Gasoline prices have fallen to a range American consumers are more accustomed to, butCorp. hasn’t forgotten about the $3 per gallon scare that swept across the country in the late summer and early fall.
So when the auto maker launches its all-new fullsize SUVs early next year, amid slumping sales and image issues swirling around the once-popular trucks, the auto maker will promote a little known gasoline-saving capability.
’07 Chevy Tahoe
Current and forthcoming fullsize SUVs equipped with GM’s 320-hp 5.3L engine are capable of running on E85, which is a blend of 15% gasoline and 85% ethyl alcohol, a renewable resource that can be made from many crops, usually corn but also wheat, barley, sugar cane or beets and potatoes.
The possibility of cutting fossil fuel consumption by more than three-quarters clearly would be exciting to consumers, who have dealt with volatile gas prices this year.
But there only are about 500 E85 stations in the U.S., and the fuel is unknown to most consumers.
“There’s not a ton of infrastructure out there or consumer awareness,” Mark LaNeve, GM group vice president-North American sales, service and marketing, admits. “But we think it (E85) is a good opportunity.”
GM has produced 1.5 million E85-capable vehicles and has the capacity to produce 300,000 units annually, LaNeve says. But GM never has put its marketing muscle behind ethanol, mainly because of its limited availability and low gasoline prices.
GivenMotor Corp.’s success marketing fuel-saving hybrids and increasing concern among consumers regarding energy security, that is about to change.
Marketing efforts will include direct mail and print ads, focusing initially on the Midwest, where the fuel is most prevalent due to the region’s corn-growing capacity.
“We’re going in to Minnesota and Illinois, for example, with some form of communication, which we’re still working on,” LaNeve says.
“We’re going to send letters letting (consumer) know they have an E85 vehicle and tell them where the stations are what the benefits are.”
GM also will outfit E85 vehicles with a different fuel-tank cap to identify their ethanol capabilities.
Ethanol has many positive factors. Besides exchanging reliance on foreign oil for a renewable, domestically produced fuel, E85 reduces sulfur and aromatic hydrocarbons for improved exhaust emissions performance. It also is cheaper than gasoline.
“I think if gas prices continue to hover where they (were in September and October), E85 will become a much more likely option,” John Larson, Buick and Pontiac-GMC general manager, tells Ward’s recently.
Ethanol’s promise is enticing, and even GM brands lacking a fullsize SUV entry are getting into the act. GM’s Sweden-based Saab Automobile will debut an ethanol-powered 9-5 sedan at the North American International Auto Show in January.
“We’re going to judge the reaction, but if it’s as good as we think it is, we can offer something like this within a year and a half,” says Jay Spenchian, Saab Cars U.S.A general manager.
However, ethanol contains about 25% less energy than gasoline, which means consumers won’t be able to drive as far on a tank of fuel. There also are concerns among ethanol critics regarding the agricultural effects from growing the massive amounts of corn required to make the fuel, namely stealing land from producing crops for food. Furthermore, corn often requires more fertilizer than other crops, raising fears among proponents of organic farming about higher levels of polluted agricultural runoff.
Ethanol production has been growing quickly in recent years, from 1.4 billion gallons in 1995 to 3.4 billion gallons in 2004, according to the American Coalition for Ethanol.
To raise awareness, GM has provided E85-capable vehicles for use in Arizona, Colorado, Illinois, Idaho, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee, Wisconsin and Wyoming.
GM also will provide vehicles to Alabama, North Carolina, South Carolina and Texas.