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GM threatens predatory dealers with order cancellations, non-transferrable warranties

General Motors will launch a second salvo against misbehaving dealerships next week with a new set of policies aimed at curbing predatory markup strategies. With the new Chevrolet Corvette Z06, GMC Hummer EV SUV and Cadillac Escalade-V about to head into production, GM is putting its foot down yet again. Dealers that attempt to circumvent GM's markup restrictions by dealing directly with brokers or other resellers could find themselves in a particularly nasty spot, as the company is threatening to withhold future allocations and end the transferability of warranties when dealers facilitate the reselling of vehicles within 12 months.  While this may help curb some dealership chicanery, it's possible the real loser in such a deal could end up being the customer who unwittingly ends up with an un-warrantied vehicle. We suspect GM has accounted for that, but we'll have to wait until next week to find out exactly how these new policies will be enforced.

Is the skill of rev matching being lost to computers?

If the ability to drive a vehicle equipped with a manual gearbox is becoming a lost art, then the skill of being able to match revs on downshifts is the stuff they would teach at the automotive equivalent of the Shaolin Temple. The usefulness of rev matching in street driving is limited most of the time – aside from sounding cool and impressing your friends. But out on a race track or the occasional fast, windy road, its benefits are abundantly clear. While in motion, the engine speed and wheel speed of a vehicle with a manual transmission are kept in sync when the clutch is engaged (i.e. when the clutch pedal is not being pressed down). However, when changing gear, that mechanical link is severed briefly, and the synchronization between the motor and wheels is broken. When upshifting during acceleration, this isn't much of an issue, as there's typically not a huge disparity between engine speed and wheel speed as a car accelerates. Rev-matching downshifts is the stuff they would teach at the automotive equivalent of the Shaolin Temple. But when slowing down and downshifting – as you might do when approaching a corner at a high rate of speed – that gap of time caused by the disengagement of the clutch from the engine causes the revs to drop. Without bringing up the revs somehow to help the engine speed match the wheel speed in the gear you're about to use, you'll typically get a sudden jolt when re-engaging the clutch as physics brings everything back into sync. That jolt can be a big problem when you're moving along swiftly, causing instability or even a loss of traction, particularly in rear-wheel-drive cars. So the point of rev matching is to blip the throttle simultaneously as you downshift gears in order to bring the engine speed to a closer match with the wheel speed before you re-engage the clutch in that lower gear, in turn providing a much smoother downshift. When braking is thrown in, you get heel-toe downshifting, which involves some dexterity to use all three pedals at the same time with just two feet – clutch in, slow the car while revving, clutch out. However, even if you're aware of heel-toe technique and the basic elements of how to perform a rev match, perfecting it to the point of making it useful can be difficult.

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.