By Lutz Deyerling
VP European Operations, Scuderi Group

The overall worldwide automotive (and engine market) is undergoing a major change unlike ever before. This change affects all players in the market, OEM´s, suppliers, new technologies, consumers and investors. There has been shocking news about the US OEM´s every day. Yesterday, for example, for the first time an analyst from Merrill Lynch said that one of the top three automakers could go bankrupt soon.

Scuderi European Vice President Lutz Deyerling addresses the crowd gathered to view the first model of the Air-Hybrid Engine at the 2008 Engine Expo in Stuttgart, Germany in May.

Wednesday’s auto news was a parade of negative earnings reports, mostly based on consumer reaction to rising fuel costs and engine inefficiency. In June, one US OEM lost 18% in sales, another 28%, while yet another big manufacturer went down 36%. Many have serious problems – none of them are able to cut costs fast enough to keep up with the cash drain. (Double digit millions of dollars daily!). This phenomenon is driven by the fact that US drivers are now shifting away from SUV´s and pick-up-trucks and seriously looking for smaller and more fuel efficient vehicles – which almost none of the US OEM´s have in their portfolio. This is a really dangerous scenario and could end in a vicious circle.

The Financial Times Germany, who has been running an editorial series called “the future of the automobile” also writes this in a recent article, the last sentence stating: “Maybe in the future they will say, these were the years, where afterwards nothing was as it had been before.”

Read the story here.

In Germany, a major discussion about electric vehicles and batteries started last week with an article about a study from Professor Dudenhoefer, who heads the well known CAR (Center of Automotive Research) at the University of Gelsenkirchen:

The article states: “A huge revolution, the end of gasoline and diesel vehicles”. From 2010 onwards, electric and hybrid vehicles will replace vehicles with internal combustion engines.

There have been several reactions on this article – for example also the CEO of Volkswagen, Prof. Winterkorn said: “the future of the automobile is the battery”. The “hype” culminated in a 16 pages article (which also was the top story) in Germany´s Wirtschaftswoche, a highly respected business magazine.

But as the article also states, many of these OEMs, suppliers and others are finding themselves having to look “Green” and environmentally friendly, even when they aren’t…

And even with all the hype around the electric hybrid vehicle, some companies are strategically separating themselves from that specific technology. Honda Corp., for example, has made that decision.

A time of change of this magnitude creates an even bigger opportunity to address the immediate benefits of the air-hybrid engine technology. While we continue to further licensing talks with many of the major OEMs around the world, the first gasoline prototype is on schedule to be completed by the end of the year. There is currently historical interest in the Scuderi Air-Hybrid Engine, which would give OEMs tremendous relief in several areas: