January was a simpler time for the relationship between Doug Pelmear/Horse Power Sales (makers of the HP2G engine that was in the Mustang we saw in Detroit a few months ago) and the Automotive X Prize. Back then, the two were happy neighbors in the NAIAS basement (the smelly, smelly basement). No longer.

Yesterday, Horse Power Sales issued a statement (read it after the jump) that said they had "officially withdrawn their team and their 1987 Mustang, powered by the revolutionary, 110MPG, V-8, HP2g engine, from the upcoming Progressive Automotive X PRIZE Competition, effective June 4, 2009" because the team "no longer feels it is in the company's best interests to compete in or be associated with the Progressive Automotive X PRIZE competition." Horse Power Sales also had a problem with a change of schedule, the change in prize purse amount, and what they saw as a conflict of interest in the way the rules were designed.

Here's the thing, though, Horse Power Sales never made the jump from a Letter of Intent (LOI) team to registered participant. Their name is not on the list of 111 official teams that the AXP released in April. We got some clarification from the Auto X Prize that says that Pelmear's criticism of the rule process is baseless and that every LOI team had a chance to give advice. The AXP said that, "no teams were involved in decisions about rules and procedures. It's very important to note that none of the teams are part of the judging panels for the upcoming Design Judging Phase of the competition nor were any teams part of a competitor evaluation process in the past" (read the rest of the AXP's comments after the break).

Also, in this week's announcement, Horse Power made no mention of their E85-powered Revenge Verde.

UPDATE: AXP's official response is here.

Related GalleryDetroit 2009: E85 Mustang

[Source: Horse Power Sale, Auto X Prize]


PRESS RELEASE:

Horse Power Sales Officially withdraws 110 mpg HP2g from Progressive Automotive X PRIZE Competition

Napoleon, OH: June 4, 2009 ---- Horse Power Sales.net, Inc. has officially withdrawn their team and their 1987 Mustang, powered by the revolutionary, 110MPG, V-8, HP2g engine, from the upcoming Progressive Automotive X PRIZE Competition, effective June 4, 2009.

Horse Power's Team HP2g was initially accepted as an official "letter of intent contender" for the X PRIZE in 2008 but no longer feels it is in the company's best interests to compete in or be associated with the Progressive Automotive X PRIZE competition.

The reasons for the official withdrawal are: (1) after Team HP2g had been accepted as a letter of intent contender, X PRIZE reduced the prize amount for the Mainstream class of the competition from $7.5 million to $5 million; (2) in our opinion, a problematic conflict of interest occurred when X PRIZE allowed one of the accepted letter of intent contenders to be a part of the competition rule setting and ultimate team evaluation processes; and (3) the changing by X PRIZE of the race date from the summer of 2009 to the summer of 2010 resulted in the race no longer fitting into the business plan and business time line for our company which is moving forward with manufacturing and marketing of the HP2g for 2010 production vehicles.

In making this announcement, Horse Power Sales.net, Inc. President and CEO, Douglas Pelmear, stated: "We have always felt that the real reason for the X PRIZE competition was to help the world. By moving forward with our production plans, we will be doing just that."

FROM AUTO X PRIZE:

As you recall, HP2g was one of over 120 teams that were in the Progressive Insurance Automotive X PRIZE non-binding Letter of Intent program. While Mr. Pelmear states in his release that HP2G voluntarily withdrew from the competition, HP2g actually did not complete the full Registration Application prior to the deadline and was not accepted as a Registered Team.

In his statement, he notes that an LOI contender "was allowed to be part of the competition rule setting and ultimate team evaluation process."

-A very large number of teams in fact had the opportunity to provide input. This was done deliberately to collect feedback from a variety of sources in an effort to build the most fair competition.. We recorded over 2,000 comments, held a webinar with the LOI Contenders, reviewed and considered input from every LOI Contender that took the time to contact us. We also held multiple working groups with industry experts to establish the competition guidelines. However, no teams were involved in decisions about rules and procedures. It's very important to note that none of the teams are part of the judging panels for the upcoming Design Judging Phase of the competition nor were any teams part of a competitor evaluation process in the past.

Here are two excerpts from official documents that may prove useful:

From the Letter of Intent itself:

The Team will receive timely updates on significant competition developments, including the release of draft competition guidelines for public comment. In addition, while there is no guarantee that the Team's suggestions will be accepted, the X PRIZE Foundation will provide written responses to all comments and suggestions submitted by the Team in response to the draft competition guidelines. As well, the Team will have an opportunity to submit additional comments before final competition guidelines are released.

From the Competition Guidelines:

We recognize that some contributors may end up competing, or perhaps advising those who compete, but that is an unavoidable result of engaging with so many experts who have real-world knowledge of the automotive industry. We believe that the Guidelines published here are balanced and credible, and that this would not have been possible without seeking as much feedback as possible from diverse parties, without regard for future possible conflicts. Had we only sought or accepted input from those unlikely to have a future interest in the competition, the result would have been poor Guidelines. Our process has been open, and we do not hide our involvement with any party.

With the publication of these final Guidelines, we are adopting a strict no-conflict policy. For example, the Prize Development Advisory Board will be disbanded and we will now appoint a conflict-free Prize Administration Advisory Board.

As to his unsubstantiated allegations, I can only say that the Progressive Insurance Automotive X PRIZE has consistently run a highly-public and transparent process in accordance with the highest professional standards. We wish Horse Power Sales well in the development and sale of their technology and we remain focused on our accepted Registered Teams and wish them all luck as we move forward in this phase of the competition.