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Volkswagen working on new VR6 engine

Volkswagen is pushing ahead with development of a new narrow-angle V6 direct-injection gas engine, sources from the German carmaker's engineering headquarters based in Braunschweig reveal. Engineering for the new engine is being overseen by Volkswagen's new head of engine development, Fritz Eichler -- who in a previous position led the development of the current generation of Mercedes-Benz AMG powerplants -- continues with a swept volume of 3.0-liters and an unfashionable 15-degree cylinder bank angle. It has been conceived for transverse mounting.

Saab 'developing diesel hybrids' to rival PSA's

Saab has been caught testing a 9-3 with a diesel hybrid engine, according to press reports in Sweden. It seems that France's PSA won't have the diesel-hybrid market all to itself. A reporter from Automobil magazine spotted a 9-3 prototype refuelling at a petrol station in Trollhattan as he returned a test car to the factory.

Obama calls for shared sacrifice in auto bailout

President-elect Barack Obama says he wants to keep tough conditions on automakers that get federal loans. The companies must develop sustainable business models because it would be unacceptable "to keep them on their lifeline through taxpayer dollars in perpetuity," Obama told The Washington Post. Obama said industry restructuring will require "everybody, from labor to management to creditors to shareholders, giving something up." His comments contradict suggestions that the new administration will relax federal loan agreements reached last month with General Motors and Chrysler LLC, possibly with softer demands on the UAW.