How much horsepower is too much?
High-performance car fans might be quick to answer that there's no such thing as "too much" power. And lately, automakers are rushing to cater to those fans: Just in the last month, GM has announced that the 2015 Chevrolet Corvette Z06 will have a whopping 650 horsepower -- a number that could be eclipsed when Fiat Chrysler (NASDAQOTH: FIATY ) reveals the final horsepower numbers for the ferocious new "Hellcat" Hemi V8 that will power the top-of-the-line 2015 Dodge Challenger.
Those are numbers that put the top-tier exotic cars of just a few years ago to shame. And there's more on the way: Higher-powered versions of the new Ford (NYSE: F ) Mustang could eventually top the Hellcat, while the German luxury-car makers are rushing to add turbos to their already-high-powered premium sedans. Even Nissan's (NASDAQOTH: NSANY ) Infiniti could soon be getting in on the game.
Motley Fool senior auto specialist John Rosevear loves fast cars as much as anybody, and he's owned a bunch -- but as an investor, he's starting to wonder if things are on the verge of getting out of hand. Products like the Corvette Z06 and the Challenger SRT Hellcat are very profitable for their makers, and great marketing tools for their brands. But in an era when fuel-economy regulations are rapidly tightening and safety concerns are higher than ever, is a full-blown horsepower war inviting trouble -- or is it just good old-fashioned tire-smoking fun?
A transcript of the video is below.
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John Rosevear: Hey Fools, it's John Rosevear, senior auto specialist for Fool.com. General Motors dropped some product news a couple of weeks ago that got a lot of attention among high performance enthusiasts, and I think it's worth a look from us as well.
Back in January, GM revealed the 2015 Chevrolet Corvette Z06, a super high performance version of the new Corvette that GM launched a year ago. I was there with my Foolish colleague Rex Moore and we brought you some coverage of that at the time.
Now, the Corvette Stingray that they introduced last year has been a big sales success, at least by Corvette standards, and now GM is going to build on that with the Z06. We knew it was going to be a monster but we didn't know how much of a monster, GM didn't release horsepower ratings for it when they showed it in January.
Well, now they have, and now we know that the supercharged 6.2 liter engine in the new Z06 will make 650 horsepower at 6,400 rpm and 650 foot pounds of torque at 3,600 rpm.
Folks, that's a whole lot of power.
GM said it's the most powerful engine ever from Chevrolet. GM's press release points out that it blows away the Porsche 911 Turbo S by 90 horsepower and 134 pound feet of torque, and it's almost certain to blow away the Porsche in price too, but in the other direction, the 911 Turbo S starts at $182,700. GM hasn't announced pricing for the new Z06 but it's likely to be half of the Porsche's price tag, probably less, the best guesses are that it will come in around $80,000 give or take.
It's a cool product, but step back a minute.
There's one heck of a horsepower war going on in the global auto business right now that has been facilitated by the technology that has come into play over the last several years. Cleaner-burning engines can generate more power while still complying with tough emissions regulations, and more sophisticated computer controlled handling aids, like anti skid systems and so forth, have made these new super-powered cars safe for ordinary people to drive, or at least a lot safer.
But this is just the latest in a lot of high horsepower announcements, we've been talking about the new Hellcat engine that Fiat Chrysler is introducing to the Dodge brand, it's a supercharged 6.2-liter version of the Hemi V8, that'll have over 600 horsepower, again they haven't said how much, and Ford just ended production of the top of the line Shelby GT500 version of the outgoing Mustang, which had 662 horsepower, and it's a safe bet that they'll do something even wilder for the all-new Mustang in a year or two.
Meanwhile, cars like the BMW M5 which has 560 horsepower have upped the game in luxury, and a version of this new Corvette engine might end up in the next Cadillac CTS-V, the old one had a mere 556 horsepower and GM has hinted that the new one will have more.
Now, I personally like high horsepower cars, I own a CTS-V, and I know that these are very profitable products as well as great marketing tools for these brands, but as an investor I have to wonder where this ends. How much horsepower is too much? If you're watching this on Fool.com, scroll down to leave a comment and let me know your thoughts. Thanks for watching.