Credit Justin Berkowitz. On a recent podcast, Justin chastised Ford President Mark Fields for begging for bucks for hybrid batteries. "Stupid schmuck," Justin said [paraphrasing]. "Ford should concentrate on getting small cars like the Focus and the Fiesta to market as soon as possible." And now Bloomberg reports that FoMoCo is committing itself to NOT developing a plug-in electric hybrid (PHEV). Ted Miller, Ford's senior manager of energy storage, said Ford would not take an "overly aggressive approach" [as opposed to a conservatively aggressive approach] to introducing plug-ins. That would be "akin to a Hail Mary." And that's bad. "A Hail Mary means that we're probably going to have to neglect a lot of other things." In other words, Ford can't afford to chase rainbows. Despite the common sense, Bloomie Scribe Greg Bensinger feels compelled to warn his readers that Ford's non-tack might leave the automaker high and dry when GM or Toyota introduce a massively popular PHEV. See? Now that's funny! Meanwhile, Blue Oval Boy Said Deep revealed there'll be a hybrid Mercury Milan and Ford Fusion in Ford showrooms by year's end, for a total of four gas – electric models. A new-ish Mercury! More Jill Wagner ads! Rejoice!

OK, OK, enough with the Yakov Smirnov references. China is no more communist than, say, California. And its vehicle sales prove it. With already-strong demand for passenger vehicles growing by 15 percent this year, Xinhua reports that Chinese automakers are set to sell 10m cars during 2008. According to information from the China Association of Automobile Manufacturers (CAAM), the demand is partly a product of falling car prices; a trend under threat from high steel costs. Moreover, as its car market matures, the Chinese government is poised to "move forward the industry restructuring by detailing standards on security, environment protection and energy saving," according to CAAM vice-chair Dong Yang. "We should keep a clear mind of the overall industry competence lagged behind that of the multi-national companies." Bringing domestically-produced Chinese cars up to international snuff will doubtless prove difficult. As the Chinese market matures and regulatory barriers to ownership increase, sales growth should level off. At some point, the People will bias the market towards home-grown products. Until then, it's double-digit growth as usual.

Chrysler spokeswoman Shawn Morgan wants the world to know that her employer isn't going to file for bankruptcy. "This rumor is false and without merit whatsoever." Rumor? More like thoughtful  analysis, after ChryCo drew down a $2b line of credit ($1.5b from 20 percent owner Daimler and $500m from 80 percent private equity owners Cerberus). This a couple of weeks before their company-wide "summer vacation." And Fitch Ratings dropped the ailing American automaker to B- with a negative outlook (more bad juju to come). Meanwhile, it was deja vu all over again for former Chrysler rescuer Lee Iaccoca. Lee addressed the troops today, bringing them a message of hope from an earlier, equally fraught time. "Automobiles in America are still a vital business," he said, seated on a stage next to current chairman Bob Nardelli. "We'll live through it. Don't panic. Things are going to be OK." According to The International Herald Tribune , Nardelli gave Iaccoca ironic props. ""Thanks to Lee, we're here today," Nardelli said. As for tomorrow…

In case you missed it, a GM test engineer named Jim Mero just poppped off a 7:26.4 lap of the famed Nurburgring. This is just weeks after Nissan's GT-R ran the 'Ring in 7:29. What's significant about the ZR1's run: the Chevy did it quicker than the real record holder for production cars, the Pagani Zonda F (7:27). But don't despair– Nissan will soon have a GT-R Spec V with more power and carbon fiber (i.e. faster and lighter) to (probably) dethrone the fastest ever Chevy. And Honda's going to make a push with their new NSX. And Porsche's refreshed 911 Turbo might beat the ZR1. You know Lexus' LF-A will. And my question is: So? Who cares? What difference does it make if car A can go around a stretch of German road faster than car B? Right? But, there's always another hand. The Nurburgring Norschleife is favored by companies looking to tune road cars; the 'Ring offers nearly all possible road condition in one (kinda) convenient seven-mile stretch. Also, the track is in fact open to the public– which makes it much somehow more interesting. I mean, imagine you're hot lapping a billion dollar test mule, you come upon Bergwerk, heel and toe to slow yourself and suddenly come upon some jackass in a GTI having the joyride of his life. How cool is that? Or is it?

Back when we started the TTAC news blog, I posted an item about the Maine DMV issuing drivers' licenses to illegal immigrants. The site took a real beating from our proto-Best and Brightest for entering the realm of partisan politics. Frank Williams and I paused, thought about it, and pressed ahead. As long as a post had something to do with cars, we considered it fair game. Still do. And I'm glad we did. In the last week alone, I've read (and enjoyed) dozens of passionate discussions about politics, religion, free speech, foreign policy, economics, energy policy, international trade, sexual morality and much more. ALL of it car-related. All of it respectful. That's no small point. Although I've banned some 300+ commentators from this site and warned hundreds more, I have only deleted two commentaires flambé in the last 14 days. Clearly, we've reached a tipping point. We've succeeded in creating a safe place for vigorous, car-related debate. As this long hot summer continues, as the U.S. car industry undergoes paroxysms of change, I commend our Best and Brightest for keeping it real, keeping it civil and keeping us– all of us– entertained. Thanks.

[As always, please report objectionable comments to robert.farago@thetruthaboutcars.com.]

Innovation is the buzzword de jour for industries undergoing major upheaval. But a study by the annoyingly-named German consulting firm Invensity GMBH, shows that automakers face unique barriers to innovation despite major industry-wide challenges. EE Times Europe details a study of 100 German development team leaders, R&D managers and design engineers from automotive OEMs. The report claims that cost pressure and reliability requirements are the greatest barriers to innovation. Some 46 percent of respondents said automotive industry, innovations are more difficult to implement than in other industries. Only 26 percent believe that the automotive industry is more innovation-friendly than other industries. Yes, well, cost and reliability pressures can actually spur innovation. So, as one of the world's most competitive industries, do automakers really have anything to complain about? Nope. It's the companies who've ignored competition to squeeze short-term profits out of antiquated technology that really need to be worried. And, now, are.

In the car biz, tire makers are something of a canary in the coal mine. And they're coughing like crazy. As America's car market falters, tire manufacturers are facing some plenty tough choices, as they try to manage rising prices and falling demand. Goodyear, America's largest tire company, is seeking relief abroad. Trading Markets reports that they're focusing on growth in foreign markets like Russia, China and Brazil, investing $500m in Chinese production and $600m on plants in Brazil and Chile. Goodyear hopes the investment will pay off with over $2b in savings by 2009. Some of those savings will come from plant closures (e.g. Australia) and longer-than-usual summer production lulls at plants worldwide. Meanwhile and in any case, most tire makers are increasing their prices. Bridgestone, Goodyear, Hankook, Yokohama, Michelin and Continental have all announced some kind of price increase this month alone. 

First, this was an easy call. Commodity costs have jumped significantly in the last year, eating into Toyota's– and everyone else's– profits. Second, as the new world leader, ToMoCo is best positioned to pass on those costs. Quoted by Automotive News [sub] CEO Carlos Ghosn admitted as much. "It's very, very difficult to move in a market without somehow the leader of the market (making a) move." Third, you gotta read between the lines here. "Our basic principle is to continue to work on cost reductions within the company first," said Toyota spokesman Paul Nolasco. "But we won't be able to avoid thinking about price hikes in the future considering a recent jump in raw materials costs." How… inscrutable. As I reported in General Motors Death Watch 182, here's real deal: Toyota wants to see what happens to the other guys– specifically GM– before upping its profits. "We'll make a final decision after evaluating April-June sales and production costs," a "top Toyota official" told The Nikkei business daily. 

We reported yesterday that Canada's Magna won a bid to build Boxsters for Porsche at it's Magna-Steyr plant in Austria. The Canadian Press [via News 1130] reports that Magna's exposure to the miserable American market trumped the Porker news, driving Magna's stock to a seven-year low. Some 53 percent of Magna's sales come from its supplier business with the D2.8; the OEM's misfortune is being passed down the supply chain. Higher gas is hurting Magna's business on the demand side, higher steel and plastic prices are hurting on the cost side, and there's no end to the hurting in sight. Magna's purchase of Plastech's exterior manufacturing business means even more D2.8 exposure, on top of the inevitable issues that come from buying a basketcase. Last week Magna cut 400 jobs from its St Thomas, Ont pickup frame manufacturing plant. There's not much else they can do besides weather the storm, and hope that their "most financially attractive offer" to Porsche wasn't a bridge too far. 

GMInsideNews says that the 2010 Saturn Aura, a clone of Opel's new Insignia midsize sedan, is on hold. GM has already shipped much of the tooling to the Kansas facility where it was planning on churning-out the Aura in late 2009 as a 2010 model. While GM hasn't made an announcement, GMI confirmed that the program has been paused, and speculates that the move will, at the very minimum, delay the next gen Aura's arrival in America. This after recent rumors that one or more of GM's brands is headed to the great automotive dealership in the sky. Is Saturn about to be strategically reviewed to death? We're not exactly talking about a critical brand for GM here, with about 7k – 8k non-SUV sales per month. Lest we forget, GM did the same product pause prior to Oldsmobile's euthanasia a few years ago. Talk about irony: Oldsmobile was starved for product and funding in the 1980s to develop the Saturn brand. On the other hand, some commenters at GMInsideNews see it differently: the pause is for fresh fuel efficient engine development. Or alternatively, Saturn will delay the Aura until 2012 or 2013, adding "Oh, and by 2013 GM will be picking up momentum at which time the 4-Door Sedan version of the Aura can return." With apologies to all you extremists, I respectfully think that's notgonnahappenatall.com.

The great state of North Carolina recently began issuing license plates beginning with the letters W, T and F. Reasonable, grown-up adults who received these plate numbers at first didn't even bat an eye at the text-slang exclamation adorning their license plates. Until their children started giggling. AFP reports that one North Carolinan with the WTF plates "wasn't hip to the Internet-age significance of her new license plate," but "developed this real self-consciousness" after catching her grandchildren laughing at the hilarity of it all. Rather than enjoying a good ROTFL, this elementary school teacher just did what everyone else in elementary school does when kids mock them on the playground: run crying to the state government. Thanks to one plateholder's stunning lack of a sense of humor, the state of North Carolina is now recalling all of the 9,999 "WTF plates" issued. Including WTF-5505 which was being used by the DMV as a media prop for stories about the state's switch from blue plate lettering to red. The NC DMV has pledged to thoroughly vet every future license plate combination to weed out any inappropriate text-message acronyms (at taxpayer expense). Note to DMV: AYSOS?

Can that be right? The last time we checked it was $16b. If Ford's tearing through $20b though to the end of '09, what do you think GM's conflagration looks like? The $1b per month stat may be an underestimate… Anyway, this terrifying tidbit re: Ford's bank balance was buried at the bottom of a Fortune article [via CNNMoney] by Alex Taylor III. The once and future former Detroit cheerleader's speculating about whether there's a Ford Motor Company in investor Kirk Kerkorian's future– after Captain Kirk and FoMoCo CEO Big Al Mulally's sit down in Sin City. And then Taylor drops the bomb. "On their flight back home, Mulally must have wondered whether he simply dodged the first bullet. Kerkorian never remains on the sidelines after buying in and the only question about his greater involvement in Ford seems to be when he will choose to make his move. He has offered to invest more capital in the automaker, a potentially welcome move, since Ford is expected to burn through nearly $20 billion in cash by the end of 2009. But like any investor, Kerkorian would not be expected to hand over his money without some strings attached." Ya think? On the other hand, maybe Kirk's just waiting for a Chrysler/GM C11 dead cat bounce before cashing-in his chips. 

Much like BMW, Audi is taking the forced induction route for upping horsepower of its V6 engines– rather than just increasing displacement, a la Mercedes or Nissan. Audi officially announced the specs on its anticipated 3.0-liter V6 TFSI engine (the T must be silent, or refers to totally supercharged, not turbo). The new powerplant will pump-out 290 horsepower and 310 lb ft of torque. On paper, it's nearasdammit the same as BMW's 300 hp/300 lb ft turbocharged 3.0-liter I6 engine. The bottom line: Audi anticipates stronger fuel economy than they'd get with a bored-out larger displacement naturally aspirated V6. Not to mention the packaging and weight benefits. Oh wait. Anyway, a tuned version will probably power the next generation Audi S4, rather than the current 4.2-liter V8. This is great news for Audi fans, since the 3.2 -liter V6 they've been using so far in the A4 and A6 is down on power compared to German, Japanese, and even American rivals. And we can't have that, can we?

The Detroit News reports Los Angeles has a new hydrogen fuel pump. A commercial hydrogen pump, rather than a fenced-off hydrogen-only fueling station. LA City Councilman Bill Rosendahl showed up in a GM-furnished Equinox Fuel Cell and announced it was "the most joyous moment I've had since being elected to office." Of course, even though it's a commercial fuel station, drivers of the approximate 100 fuel-cell vehicles won't have to pay for the hydrogen they pump. They're all part of "demonstration programs by the motor companies." So what happens when the owners start having to put their debit card in the pump to pay for their fuel like the rest of us? Good question. So far no one's saying how much it costs to produce or dispense the stuff. And apparantly no one cares. The California Air Resources Board is spending $7.7m of the taxpayers' money to open three more fueling stations so they can give away more free fuel to people driving cars they don't have to pay to operate so the anti-ICE crowd can get more propaganda free publicity.