We've been sounding the alarm on Detroit's liquidity "challenges" even before the automaker's began their most recent "turnaround" efforts. Before I relate Automotive News' [sub] tardy take on the situation, keep in mind that Ford has abandoned its promised "return to profitability" target (and not set a new one), GM never had a publicly pronounced plan to get back in the black (how great is that?). And Chrysler's gone into radio silence since its private equity owners bought themselves a multi-billion dollar passel of trouble. And don't forget Fitch's Ratings has better access to corporate info than Automotive News; they've downgraded all three automakers and put them on negative credit watch. Alright then… GM "will burn through about $1 billion a month this year and $6.3 billion next year, says Patrick Archambault, an analyst for the investment bank Goldman Sachs Group Inc. That would leave an anemic $8.7 billion in cash by the end of 2009 unless GM dumps assets or adds new debt, he said." Ford "is in better shape — about $29 billion in cash and $11 billion available through credit lines. Moody's Investor Service says Ford could exceed a two-year total cash burn of $14 billion by the end of 2009." Chrysler "started 2008 with slightly less than $10 billion in cash. On June 18, Bloomberg News reported that Chrysler will burn through $2.5 billion this year and would end the year with $7.7 billion in cash." We're thinking they're all low-balling. You? 

In today's Wall Street Journal, Joseph White proposes Three Vehicles Detroit Should Build. Y1) a seven-passenger vehicle that gets 30mpg highway, 2) a midsize sedan that gets 40mpg highway that doesn't cost much more than a Malibu or Camry, and 3) a pickup truck large enough to do real work and comes close to 30mpg highway. Worthy goals, indeed. But, Mr. White, may we suggest looking at what the competition already has on the market: 1) no current US market seven passenger gas-powered vehicle gets close to 30mpg highway. [Note: such vehicles exist overseas – assuming you don't look like the humans in WALL-E] 2) The Toyota Prius is the only midsize car that gets 40+ mpg on the highway, never mind that the Cobalt XFE can't hit that number on the side of a barn despite its stick, and 3) if someone builds it (a compact diesel pickup), will they come? What of high diesel prices and competition? And what if ALL of The Big 2.8 builds these self-same vehicles? Anyway, the D2.8 have enough to worry about just trying to survive the next year, much less leapfrogging the competition in the fuel economy department.  Of course, there's always the option of installing much smaller engines and asking customers to put up with 0 – 60 times up to 20 seconds, just like in the 1970's. 

You want evidence that GM takes TTAC seriously? I got nothing. You want proof that GM should lend us an ear, or another indication that the American automaker's just too damn slow? No problem. Back in April, Edward Niedermeyer flagged the fact that Chevrolet was [all too quietly] selling a higher-mileage Cobalt XFE with re-jigged gearing and low-resistance tires. "These are exactly the kind of common-sense efficiency improvements Chevy (et al) should spread across their lineup," Edward opined. Yes, the Detroit Free Press reports that "thanks to quick action by GM's engineering and marketing teams," the Cobalt's twin-under-the-skin Pontiac G5 also gets the mods and the new badge. Quick? Yes! Quick! "We saw fuel prices rising early this year, and rather than sitting on the sidelines in a Motown hole-in-the-wall knocking-back boilermakers worrying, we did something," Chevrolet spokesman Terry Rhadigan boasts. Unfortunately, it doesn't look like GM's going promote these "new" cars; Lordstown's maxxed out as it is. And GM's hasn't quite committed to the XFE concept. "Chevrolet may apply the strategy — and the XFE badge — to other model lines. Other GM divisions may do the same, although they might not use the same XFE badge." Hey, what's the hurry?

For the third time, a dramatic oil price spike has thrown the auto industry a curve ball. And once again, after years of supersizing, manufacturers are lacking the right-sized, economical products for which the market is desperate. Instead of spending three to five years developing new cars from scratch, it’s time to dust off the best from the past and put them back into production. An air bag here and some updated engines and technology there, and these seven classics are ready to save the day in each of the major categories:

If a gathering of crows is called a "murder," what do you call ten New York Times Op Ed pieces on high gas prices? A derrick of… no, I won't say it. Luckily, the Times only provides McNuggets for their "Is Your Tank Half Empty or Half Full?" editorial agglomeration. So… Pajama Life: Nicole Belson Goluboff, author of “The Law of Telecommuting,” says telecommuting rocks! Fuel for Inequality: Robert R. Reich says poor people are harder hit by rising gas prices than rich people. What the Green Bubble Will Leave Behind: Daniel Gross looks forward to driving a plug-in electric hybrid charged by a wind mill in his driveway. Ghosts of the Cul de Sac: Allison Arieff says high gas prices will kill the suburbs (so much for Gross' driveway). Goodbye to the Great American Road Trip: Michael Paterniti says fuck that shit. Tax Brakes: tax the Hell out of driving. I mean, the feds should give tax credits for NOT driving. Be the Prius: Tom Vanderbilt recommends hyper-miling. Or is that eco-driving? Psychoanalysis by the Gallon: Viennese scribe Annaliese Rohrer is, gasp!, on the subway "more often than I normally would choose to be." The Light Stuff: Jamie Lincoln Kitman (a car guy!) believes Detroit should be, sorry, build, smaller cars. Hair-Raiser: Karen Karbo loads us with this jewel: "Until [bicycle] helmet hair becomes universally chic, we will never be free of our dependency on mom chauffeuring us to the mall." (Her mom chauffeurs her to the mall?) So, what did we learn? 

After thirty-two years in the media, I know how this works. You take a popular, generally negative story like, say, rising gas prices. You think of a likely trend within the story: the effects of $4 a gallon gas on teenage cruising. Must be down, right? Makes sense, yes? So you find people who can validate the central thesis: teens, teens' parents, cops. You weave the tale with plenty of anecdotes and call it good. In fact, there's only one thing missing from this otherwise boilerplate New York Times feature: facts. "From coast to coast, American teenagers appear to be driving less this summer. Police officers who keep watch on weekend cruising zones say fewer youths are spending their time driving around in circles, with more of them hanging out in parking lots, malls or movie theaters." Note the word "appear." And the reliance on an unspecified number of police officers. To be fair– not always a NYT hallmark– The Grey Lady mentions the possibility that the dearth/death of cruising might have something to do with… something else. "To be sure, the number of teenage drivers nationwide was already on a downturn over the past decade, a trend fueled by tighter state laws governing the hours when teenagers can drive, higher insurance costs and a move away from school-sponsored driver’s education programs to more expensive private driving academies." To be sure, we expect better reporting from America's newspaper of record.

We've heard talk for some time that Porches will be gracing the world with a diesel Cayenne. Sourced from Audi via Volkswagen (now essentially owned by deep-pockets Porsche), the 3.0-liter oil-burner is more a volume and CAFE proposition than anything related to performance. Seeing as how the off-roading (not) Cayenne is already the poster boy for all that's wrong with the brand, no one really cares about a diesel truck. But check this: it seems as if the yet-to-be released Panamera 4-door is getting the same engine. According to the Ozzies at Motor Authority, Porsche let slip at a focus group right here in California that the big sedan will have a spark plug delete option. Interestingly, Porsche now has access to all the diesels in VW's garage– the V8, V10 and V12. But all those mills are too heavy for Panamera duty. At this same focus group, Porsche also indicated that a Panamera Targa is in the works, to compete with a convertible version of the upcoming Audi A7. Wait a second– focus groups?

Ha! So close, yet so far. American Axle CEO Dick Dauch's '07 paycheck– $5.55m salary and a $8.5m bonus– doesn't quite eclipse GM CEO Rick Wagoner's $14.4m compensation. But hey, what's $350k between friends? And, it must be said, that's a lot of money– even if Dauch did break– sorry, "settle" a three-month strike by cutting half of AA's 3,650 member unionized workforce, instituting a two-tier wage system (lowering newbie wages by roughly 50 percent) and "convincing" GM to kick-in $215m to pay for bailouts. As AA's independent compensation committee put it, the bonus "took into account the company's strong financial performance in 2007, the structural transformation achieved under our new labor agreements with the UAW and… Dauch's leadership role in these negotiations." There, that sounds better. Neither the UAW nor American Axle's president (Dauch's son, appointed post-strike) were available for comment. Meanwhile, well done to The Detroit News for not totaling the CEO's compensation for their headline. There's only such much shock and awe Motown can take these days. (P.S. Isn't it amazing how all this big bucks salary stuff comes out during the weekend?)

“We have a model that is buy, fix and hold,” Timothy Price, managing director of Cerberus, told the Financial Times last Thursday. “It is not a problem for us to have a 10-year holding period.” Riiiiiight. The FT reckons "Chrysler was forecast to lose $1.6bn last year following a $1.4bn loss in 2006." This year's sales are a 9mm slug to Chrysler's chest. With no immediate or even medium-term prospect of undigging that hole, and ChryCo banking a $2b loan, TTAC sources have reiterated their belief that the company-wide summer vacation signals the end. The Canadian Press reports that Chrysler "told workers in a memo on Wednesday that the Toledo North Assembly Plant, which makes the Jeep Liberty and Dodge Nitro midsize SUVs, will be shut down for seven weeks from July 7 through the week of Aug. 18 due to sagging sales. The Newark, Del., Assembly Plant, which makes the Dodge Durango and Chrysler Aspen SUVs, was shut down starting Monday for five weeks, with workers scheduled to return Aug. 4, and the Warren truck plant, which makes the Dodge Ram pickup, will close for five weeks in late June and July." Normally, these are one to two week breaks. This time, the rumor mill insists, they will be permanent. [NB: the August third "hard stop" represents the last day Cerberus can sue Daimler for false conveyance.]

Automotive News [AN] reports that the Wall Street Journal has got a hold of a J.D. Power report on June's sales stats. As you can see above, it ain't pretty. In fact, it's ugly as Hell. If J.D.'s mob are even remotely accurate, the U.S. market is undergoing a contraction violent enough to make a mother of five think twice. "J.D. Power and Associates is predicting the June seasonally adjusted annual sales rate will plunge to 12.5 million vehicles, down from 16.3 million last June. That is far below what other analysts have projected for the month's sales." Especially GM, which predicted (at last count) 14m new vehicle sales for the year. J.D. Power expects Toyota's sales to tank by 6.6 percent. "That would give it a market share of 18.7 percent, near GM's predicted 19.2 percent share." Yes, well, there is no way GM can sustain itself at a 19.2 percent market share of 12.5m vehicles. Chrysler? Again, I reckon their company-wide summer break will be terminal. Meanwhile, the real numbers will be released on Tuesday, and TTAC will be there. 

Back in 1783, Paris was all abuzz with the exploits of the Montgolfier brothers’ balloons. Using a simple bag and a lot of hot air, men (and sheep) were able to fly (or at least float). One of the observers was none other than Ben Franklin, who was fascinated by the display. An onlooker was less impressed “What use is it?” America’s founding dirty-old-man smiled and replied, “Of what use is a newborn baby?"

To bring you up-to-speed (so to speak) on Norway's homegrown EV maker: "In 1999, Think [was] bought by the Yankee giant Ford Motor Co.," LA Times writer Dan Neil relates. "which was scrambling at the time to comply with California's Zero Emission Vehicle mandate, essentially requiring automakers to build fleets of electric vehicles. Ford renamed the company Think Nordic and began a complete redesign of the car. When, in 2003, the American automakers succeeded in modifying California's mandate, Detroit's flirtation with electronic vehicles ended. General Motors Corp. famously killed the EV1 program, and Ford sold Think to a Swiss electronics firm." So Dan flew over to Aurskog to have think about the recently resurrected Think (and avoid using the word "think" until the summation). Once again, range. "Now, after several course corrections that added perhaps 20Still the Think City — a 2,449-pound runabout with plastic body panels and an official range of 112 miles on full charge — hums along." AND [allegedly] meets federal crash and safety standards, thanks to FoMoCo development. While Think has yet to think-up a suitable anything plan for the U.S. market, Dan thinks Think proves that EVs are viable. I think. "Is a safe, practical electric car possible? The answer seems to be yes." 

Presuming, of course, you're reading this in North America, rather than, say, New Zealand. NZ's Otago Daily Times claims to be surprised (surprised I tell you) by the new Euro-Accord station wagon. "Its arrival comes as part of this month's rollout of an all-new Accord Euro, and completes a freshening of the Accord range that started when a new iteration of the larger, softer V6 was introduced earlier in the year." Not only was scribe David Thompson caught unawares by the Accord wagon, but his efforts to put the wagon through its paces were thwarted. "My plan to preview the new Accord Euro with an extended drive in the upper South Island was thwarted when fog disrupted early flights out of Dunedin at the start of last week. By way of partial compensation, I managed a short drive around Dunedin in one of the first new Accord Euro sedans to arrive here." And Davey was… unsurprised! "Not surprisingly, the car I sampled still felt a little tight mechanically." What exactly does that mean? Your imagination will have to fill in the blanks. Meanwhile, should Honda build an Accord wagon stateside?

This story isn't earth shattering, but I want to see if Autoblog can resist dogging us. Beer, ethanol, politicians, FlexFuel vehicles, har-har. From our perspective, the fact that Coors brewery will supply the Colorado democratic hoe-down's 450 vehicles with ethanol creates cognititive dissonance on a couple of levels. For one thing, the Coors family are (were?) known for being right of Attila the Hun. The company's been accused of being anti-labor, pro-terrorist, racist, anti-gay, anti-women, pro-Nazi sympathizers and anti-environment. Why would the DNC would want to cozy-up with Coors? It puts the party's support for ethanol in peril. Which brings us to point number two: why would the democrats NOT choose an ethanol supplier from the corn belt? You know, corn ethanol instead of wheat, barley and hops ethanol? Not only does beer-based ethanol open them up to all sorts of infantile headlines (AB?), it also misses a key opportunity to pander to Barack's pals in Big Corn. Sure, they'd have to truck it in, which would make the supply hideously carbon positive, but we're the only ones keeping track of that action. Speaking to 9News, Andrew Ballard, the director of transportation for the DNC, has a simple answer to all this. "Hey, I'm always up for free gas, especially with prices being what they are today." 

Whatever else you can say about White House hopeful John McCain– and you're going to say lots– the guy's got a set. Followers of our E85 coverage will recall that McCain was the only candidate to come out against ethanol-related subsidies for corn farmers before the Iowa primary. While in Iowa. Yesterday, the Arizona senator toured Lordstown (home of "high mileage Chevrolet Cobalt and Pontiac G5 economy cars"), and then came out against a federal 911 for any of Detroit's ailing automakers. Speaking at a town hall meeting, McCain was all about putting government dollars into "research" into alt propulsion (a $300m prize for anyone who can guess how much money he'd send Motown's way). But a bailout? Automotive News [sub] provides the money shot: "A bailout, I don't think works." In fact, The Detroit News quotes McCain's antipathy to bailouts in general. "Frankly I just don't see a scenario where the federal government would come in and bail out any industry in America today." Over to you, Barack.