DETROIT -- Tougher fuel economy and emissions standards won't mean the death of Fiat Chrysler's V-8 engine lineup, CEO Sergio Marchionne says. But in an interview with Automotive News last month, Marchionne conceded that it is getting harder for FCA to stay in compliance with the federal corporate average fuel economy rules. For now, he said, the key for keeping powerful engines in FCA's lineup is the purchase of clean air credits. "One of the things that we learned to do is how to buy stuff," Marchionne said. "We buy credits. ... The purchase and sale of credits is actually more efficient than capital today." FCA lags behind every other mass-market automaker in fleet fuel economy and emissions. According to the EPA, FCA was the industry's largest purchaser of emissions credits for the 2013 model year, the most recent year for which figures are available. FCA purchased most of its credits from Tesla Motors. Under EPA rules, the credits serve as a form of currency. Automakers can offset their carbon footprint with emission credits earned by the sale of other vehicles. While other automakers have used strategies such as turbocharging smaller displacement engines or direct injection to achieve fuel economy gains, FCA has chosen to increase the horsepower of existing engines. Recently, speculation on the FCA-centric site Allpar.com has suggested that the company might be forced by fuel economy regulations to abandon its V-8 Hemi engines or even its 707-hp Hellcat V-8 in favor of turbocharged V-6 offerings. But Marchionne threw water on that idea. Asked whether new regulations will mean the death of V-8s such as the Hellcat, he said: "No. We offset. I mean, every time we do one of those things, we offset." Still, automakers won't be able to purchase credits from one another forever. That has meant an engineering push inside FCA to find another solution. "The biggest challenge for me now is to find truly a compact and midsize car solution that is actually [greenhouse gas] positive, by a stretch," the CEO said. "And you know how the rules are, so it's a question of footprint and so on. I need to find a solution, so I've got a bunch of kids who are sitting in the basement tearing apart the front end to find out whether we can find a way out." The other major powertrain issue hanging over FCA has been ongoing performance problems with its nine-speed automatic transmission. The nine-speed, which debuted in the 2014 Jeep Cherokee, had been the source of troubling consumer complaints even as it rolled out in other vehicles. Earlier this month, FCA said it had produced its one-millionth unit of the nine-speed at its massive transmission complex in Kokomo, Ind. Marchionne said changes have been made to the nine-speed for the 2016 model year that should quiet its critics. "We've been working our ass off with [designer ZF Friedrichshafen] on the nine speed," he said. "There were some things that were built in as a technical solution that proved to be, in hindsight, unwise, and so the remedial stuff has been put in place." You can reach Larry P. Vellequette at email@example.com.
Marchionne says FCA will continue to make V-8s despite tightening regs
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