Can the "high-performance" end of the car business be considered "green?"
I think it's hard to find a connection between a 12-cylinder, 600-horsepower, $200,000 monster SUV that's designed for an oil sheik and fuel economy – but manufacturers argue otherwise. AMG, for example, is the hot rod division of Mercedes-Benz and at present it sells 22 different models of "premium, performance" cars and SUVs to people for whom the price of gas is non-material.
"New technology is very expensive," said Thomas Weber, a member of the board of management of Daimler AG and responsible for group research and Mercedes-Benz cars development since 2004. "At AMG we build innovative, high-performance vehicles that are compelling to our customers. These customers are willing to pay more for this driving experience so we can afford to develop new technology for them. Soon, however, this technology will spread where appropriate across the Mercedes brand."
This discussion came about during a function to mark AMG's 45th anniversary. In 1967, Aufrecht und Melcher Grossaspach (AMG) was set up by two technicians who left Mercedes because they wanted to go racing. It took until 1990 for Daimler to realize there was something important going on there and began working with them formally. In 2005, Daimler acquired 100 per cent of AMG and has used it since then as their high-performance development shop.
And what a profitable business it has been. AMG sold about 20,000 souped-up, premium-priced vehicles last year and wants to sell 30,000 a year in short order by expanding the lineup, particularly in smaller vehicles. In addition, Mercedes loads expensive AMG accessories on to about 25 per cent of all Mercs sold worldwide.
But what makes AMG very different from a "tuner shop" is that they have now developed both their own engines and their own vehicle from the ground up. The vehicle is the SLS AMG, a super sports car that is intended to be an icon for the whole Mercedes brand. It is similar to what Audi's Quattro division did by independently developing the R8 sports car.
All of this sounds like a great money maker, but where's the green? Ola Kallenius, a highly energetic Swede, is AMG's chairman. "Efficiency is one of the keys to victory," he said. "We concentrate on performance technologies from engine and chassis through high performance braking to intelligent lightweight design. Less weight means more dynamics with lower fuel consumption."
There are almost 1,000 engineers and technicians at AMG and among them are experts in integrating carbon composite into aluminum bodies and space frames. Their engine builders have developed what they claim is the world's most fuel-efficient V-8 engine. "We have been able to reduce the average fuel consumption of CO2 emissions of the AMG fleet by 25 per cent since 2008," said Kallenius. That's been achieved in part by including smaller vehicles in the fleet but Kallenius says they'll drop fleet fuel consumption by as further 20 per cent within five years.
That's a signal as to where both AMG and Mercedes have to go in the near future: smaller, lighter, more fuel-efficient vehicles and most likely more expensive vehicles too. First out of the gate in this direction for AMG will be the A 45 AMG, which is the high-performance version of the new Mercedes compact family car, the A-Class.
The first thing the AMG crowd did was build a new engine for it; a high-performance, two-litre, four-cylinder turbo. No details on it yet but the company promises it will be the segment leader in both horsepower and fuel economy. The AMG version of the A-Class also gets a double-clutch seven-speed automatic transmission and standard AWD.
This should be one hot little car but of course we won't get it in North America. The A-Class is too small for Americans and, horror of horrors, it's a hatchback. However, there's a new B-Class coming that will be Americanized and AMG will surely get their hands on that one.
So back to the question: can a premium-priced, high-performance division be considered green? It can if you believe in supply-side economics and tax breaks for the rich. Eventually the good stuff will trickle down to us.