As if. Still the woman once awarded "the best breasts in Hollywood" nod by every hetrosexual male in America is over-the-moon in love with Honda's PR-mobile: the hydrogen fuel-cell-powered Clarity. "Our family is going to pay for the privilege of having the chance to show, by action, a car that is an alternative to gasoline," she told CBS News. Note: "is going to." Yes, CBS and Jamie Lee are hyping the Clarity before it's been delivered. And once again, the mainstream media is happy to talk about hydrogen fuel cell vehicles as if the liquified gas in their tanks is made by zero-emissions pixies. Hello? It takes energy to make hydrogen. And that means CO2 and plenty of it (solar shmolar). While we await numerous opportunities to highlight this inconvenient truth, CBS points out the echt drawback to JLC's Clarity and its hy-powered ilk. "But the real problem with these cars is keeping them filled up – there are very few fueling stations. Even here in Southern California with the greatest concentratrion [sic] of stations, there are still fewer than 20. In the meantime, [Vasilios] Manousiouthakis makes do. His [hydrogen-powered Mercedes] car can only travel 80 miles on a tank of fuel, and the nearest hydrogen station is 10 miles from his home. On this day, the fuel pump is broken. With the nearest hydrogen station another 10 miles away, Manousiouthakis knows his car won't make it. "I need desperately fuel right now. I'm literally on fumes so I cannot get out," he says.  It takes two men and a consultant on the phone to solve the problem. "It takes commitment," says Manousiouthakis. Or something. 

"Across government, the vast majority of E85 purchases made with government-issued credit cards don’t register as E85," FederalTimes.com reports. "One recent study suggests as much as two-thirds of E85 purchases are incorrectly recorded; another puts the figure at 82 percent." In other words, no one knows how much U.S. tax money is being spent on corn juice. In other other words, the feds are spending hundreds of millions of dollars propping-up the ethanol industry without a clue whether it's a waste of money or not (hint: it is). Yes, it's a major SNAFU. "To adjust for discrepancies in alternative fuel reporting, GSA [General Services Administration] in fiscal 2006 began reporting all fuel purchases for E85 vehicles governmentwide as E85 transactions when the cars went to stations that sell E85. But according to the November study… 45 percent of fuel purchases for E85 vehicles actually are gasoline rather than E85, meaning that GSA may be overestimating the amount of E85 purchased. "Our reports to Congress on alt fuels are suspect," says Marc McConahy of Vista Consultants, who studied the problem for two years for the Energy Department. "and I’m being kind when I say ‘suspect.'" 

Washington Post columnist Warren Brown shares his thoughts on last week's Escalade Hybrid (EH) press conference. Not suprisingly, Warren's aware that now my not be THE best time to be launching a $79k SUV– even if is less thirsty than its less expensive gas-only variant. Still, in the end, Warren joins GM in their luxury barge as it drifts down denial. "Big tricked-out SUVs… retain considerable market pull, even in a market where monthly fuel bills are beginning to rival monthly amounts due on vehicle finance notes. There appears to be a cadre of hard-core fans, influenced by needs real and imagined and guided by a passion for motorized might and luxury, who are keeping the big rides on the road and in the showrooms." Warren is happy to parrot GM's sales projections for the EH (say it like you mean it). "With 60,000 Escalade sales last year, Cadillac was the undisputed leader of the luxury SUV market. But even with its new Platinum and hybrid models, Cadillac will be lucky to sell 40,000 this year, GM officials conceded. But 40,000 is still good business." This from the same company that overestimated '08 U.S. new vehicle sales by some two million units– so far. And just in case you'd think that Warren would call GM on this turkey, no. "The 'hybrid' tag comes with a hefty price premium — $5,000 to $8,000 more, depending on the model. Will hard-core SUV buyers go for that? Maybe they will." For sure, they won't. 

Retail issues aside? Like, um, the fact that GM's pulled the plug on the brand, assuring depreciation that would give a Maserati buyer the Willies? While I have no doubt that Autoblog's Dan Roth would tell us if he had someone in the HUMMER business, I also have no doubt that if he did, that person would be well pleased with Dan's blog on the doomed maker of militaristic SUVs. "Moving product is a tremendous challenge when the bobbleheads on the nightly news continue shrilly about the price of fuel and you've got a lot full of low-mpg, high weight trucks that happen to be a favorite target of vandals euphemistically masquerading as 'activists.' Customers that do make it through the door are looking for deals, and HUMMER will spot you five thousand bucks to take an H3, PLEASE." In other words, it's a great time to buy! "If you've got a boat to pull, and want to look like the Governator, an H2 could still be just the thing, and now you'll be able to find one for a song; most likely the blues." As Dave Edmunds sang, "Everything's wrong but nothing is right."

Now that Chrysler's HR honcho Nancy Rae has sent us a primer for pessimists, it's time for The Detroit Free Press to find some light at the end of the tunnel that doesn't look the headlight of an oncoming train. First the bad news, albeit with a light dusting of sugar coating. "Detroit's automakers are bleeding cash, despite massive cost-cutting and job reductions in recent years," Justin Hyde "reports." "And while each has socked away funds, the money will last only until 2010 at the latest unless the companies borrow to buy more time, analysts say." And then, hints of hope(tm)! "If you're looking for some sign of light in the gloom, there are glimmers. Unlike previous slumps, the vehicles built by Detroit's automakers are broadly on par with much of their competition. The landmark deal that will lead the UAW to take on health care for workers will free up cash in 2010, especially at General Motors Corp. All three companies are pushing new fuel efficient models, with side bets on more exotic technology such as plug-in hybrids." But even Hyde can't. "But a permanent cure — generating enough cash to pay their debts as they roll out new vehicles — appears unlikely before 2011, and another unexpected jolt could tear one or more of them asunder, analysts say." What corporate arrogance has created, let no market rent asunder? Good luck with that.

Man, am I getting old. I surfed onto The Incredible Hulk on the SciFi channel last night to find David Banner getting all Gamma rayed-up. The Hulk burst through the front of a house. All I could think was, oh my Lord, that's going to cost a fortune to fix. (My neighbor's house was recently pulverized by a large green… tree.) Maybe it's because I'm happily married, or perhaps it has something to do with the WWF, or it could be that episode of House involving hypogonadism, but steroids-run-amok homoerotic imagery just doesn't do it for me. Sure I understand the appeal of watching someone or something getting mad and busting up the joint. Call it the Shiva the Destroyer Complex. But I want to assure you this site in general and myself in particular take no joy in what's happening to The Big 2.8. That said, I've come to terms with TTAC's bearer of bad tidings nature a long time ago. While I will endeavor to add some levity to the mix, the U.S. automotive market is going to get a LOT worse before it gets better. And TTAC will be there every step of the way, no-holds-barred. The truth hurts.  

Given that TTAC still occupies that special place in the autoblogosphere where we can afford to pay our writers something between bupkis and a pittance, it's no surprise that "our" Jonny Lieberman freelances his little heinie off. JL's hooked-up with a new site called autofiends.com. We're down with that. Not only does it help provide our man in LA with access to strange and marvelous and prosaic vehicles to review, but it also… um… keeps him from working for Auoblog (as if). Anyway, Jonny's graciously shared this photo of the caught-in-the-wild new 7-Series sans watermark, snapped by his pal Levy in the desert. Or is it a the new 5? All I've got to say is that I'm not sure which is more retro, the camo on the car or autofiends logo. Anyway, we wish JL luck in this new venture, even if he has reduced us to sloppy seconds. We look forward to more of the same. 

Sources tell TTAC that the glut of SUVs and trucks is so bad that the banks are not calling in the repo men. I repeat: banks are cutting maximum slack to people who are behind in their loan payments– to the point where some are driving around in their vehicles without making any payments. In a bizarre way, this makes perfect sense. Repo services cost money. Re-conditioning costs money. Storing the vehicles costs money. Equally important, the banks/credit agencies don't take the full hit to their bottom line until they sell the vehicle. Needless to say, the market is so stuffed with both brand spanking new and slightly used (i.e. excellent condition) product that we're talking about a MASSIVE hit. What's more, our man in the auction biz tells us that many dealers are holding their light trucks until the end of the month– and then selling them without reserve. You can imagine what that's doing to residuals. If not, check this from Tom Folliard, president and chief executive officer of CarMax: "During the quarter, wholesale industry prices for SUV's and trucks declined nearly 25%, which is approximately four times the normal depreciation expected over this period and well in excess of the depreciation expected over a full year. This is the most rapid depreciation of any vehicle segment that we have experienced in our 15 years."

Marketwatch gives us our usual dose of pre-weekend gloom. It reports that Moody's "lowered Chrysler LLC's outlook to negative from stable and affirmed its B3 corporate family rating and probability of default rating… This erosion in market fundamentals could stress Chrysler's liquidity profile by late 2009 or early 2010." More bad news [via] The Australian: Ford Motor Credit is headed for the buffers: "Now the auto lender, faced with falling asset quality and burgeoning provisions for credit losses, may have to tap its parent for help at a time when Ford Motor is reeling from a sales slump and deeper production cuts." At the same time, CNNMoney reports that Standard & Poor's "put Ford Motor Co. on a negative credit watch list because of worries about the health of the U.S. auto industry… S&P also placed General Motors and Chrysler on CreditWatch with negative implications. "We have renewed concerns about all three automakers' future cash outflows in light of the prospects for U.S. sales for the rest of 2008 and into 2009," announced S&P credit analyst Robert Schulz. "It's hard to imagine what else you can throw into the mix to make things worse," added fellow analyst Efraim Levy. Hard, but not impossible. For example, what happens to Ford and GM's supply chain when Chrysler files (on a Friday)?

Like all of TTAC's writers, Glenn Swanson came to us as a reader with a "real job:" IT administrator for a Connecticut public school. As a public servant, Glenn specializes in stories where personal liberty and automobiles intersect– sometimes literally. He wrote our three-part Presidential Primer, investigating White House hopefuls' stances on auto-related issues. He also has a taste for true crime, such as this piece about a stripper who "borrowed" someone's identity to buy a 2005 Maserati. In all cases, Glenn brings righteous indignation and a sardonic sense of humor to the keyboard; he's also the only contributor whose OCD rivals mine ("this is the final version"). Glenn's wife emails: "About 3 weeks ago, he ended up in the hospital and has been diagnosed with a form of Leukemia. Therefore, he won’t be able to write for TTAC for awhile as he focuses on his recovery. He does have his laptop with him in the hospital and is keeping up to date with the site." I reckon Glenn doesn't need any of that "fight the good fight" stuff. I bet he needs a good laugh. So, what's the funniest thing that ever happened to you in a car? For me, it was a cop shining his flashlight on some hash wrapped in aluminum foil. "What's that?" he asked. "Aluminum foil," I replied. "Oh," he answered. Happy times.

[for more of Glenn's work Google site:thetruthaboutcars.com "glenn swanson"]

(The following email was sent to Chrysler employees today. It was released to the media with a note which read "'This information should help you cover Chrysler. We also sent it to our employees to help them as ambassadors of the company – Nancy." We leave it to you, our Best and Brightest, to make what you will of it.) 

Keeping Track of the Facts on Chrysler LLC
By Nancy Rae
Senior Vice President, Human Resources and Corporate Communications

As the industry goes through a period of great change and a slowing economy, we all face difficult questions about the status of the industry and our company.  Following are a number of the leading subjects that come up in the media and in our daily conversations, as well as information you need to know and share:

GMInsidenews.com is quoting sources lacking even the thinnest euphemisms who whisper that Pontiac and GMC both could be on the chopping block. "At the moment," writes "nsap" of GMI, "the GM Board of Directors is leaning toward killing GMC as the brand is made up entirely of rebadges. The Board is also taking into consideration that GMC is mostly trucks and SUV's, both market segments that slowly dwindling." HUMMER is for sure dead (duh), and Saturn may get bumped to the PBG channel if (when) this all takes place. Not only does GMI fail to indicate a source, they attach a disclaimer. "Please remember that all of the above are RUMORS and should not be taken as solid fact." The only thing this rumor has going for it is that it makes a lot of sense. Neither brand really does anything Chevrolet can't, and in bad times that means they're expendable. BUT (caps lock off) GM can't kill anything without killing an entire channel (Buick, Pontiac, GMC)– and facing thousands of lawsuits. Unless they're in bankruptcy.

TTAC’s Deep Throat and I have been talking about GM’s decline and fall for well over two years. My man’s mantra: “follow the cash burn.” And so we have, through foreign misadventures, asset fire sales, union payoffs, supplier bailouts and more. We’ve watched GM CEO Rick Wagoner mortgage the American automaker’s future to conflate the company’s bottom line— to little avail. Throughout this firestorm, we’ve wondered how the automotive and financial press could miss the simple fact that GM’s been taking in less than it spends for a long, long time. And now, suddenly, they’ve noticed. And now the end is near. Here’s how DT sees it going down…

First of all, the National Labor Committee says that less than 15 percent of its money comes from labor unions. So this is not a United Auto Workers' front organization. Second, in a phone call [below] Director Charles Kernaghan was clear that Toyota's Japanese factories adhere to the country's labor laws (even though you may be surprised to learn that ToMoCo's been on a two-tier wage system for decades). Kernaghan's beef is with the automaker's suppliers. "Toyota's much admired 'Just in Time' auto parts supply chain is riddled with sweatshop abuse," he insists. "Including the trafficking of foreign guest workers, mostly from China and Vietnam to Japan. They're stripped of their passports and often forced to work– including at subcontract plants supplying Toyota– 16 hours a day, seven days a week, while being paid less than half the legal minimum wage. Guest workers who complain about abusive conditions are deported." The organization's report is low on stats, big on anecdotes and focused on pious Prius celebs. And yet, it's a point we've brought up before. International automakers'– and their customers'– willingness to turn a blind eye to their suppliers' working conditions is a black eye for the business– albeit one cleverly covered by makeup. 

After losing its "best-selling vehicle in America" badge, Ford's F-150 has hit another pothole. Automotive News [sub] reports that the beleaguered Blue Oval Boyz are postponing the release of the all-new 2009 model by two months. The coompany says the delay will Ford can burn through its massive overstock of the outgoing model. Both F-150 plants will lose a shift this year, and one of the two will idle for most of the third quarter. These cutbacks are just part of the Ford's production slowdown. The Wall Street Journal reports that Ford will cut overall production by 25 percent in the third quarter, and by as much as 14 percent in Q4. "Ford has taken decisive action to respond to this accelerating shift in customer demand away from large trucks and SUVs to smaller cars and crossovers, and we will continue to act swiftly moving forward," says FoMoCo CEO Allan Mullaly. Ford also says its pre-tax earning will be worse in 2008 than 2007, and that cash burn will be higher than previously expected (by them, maybe). With $40b in liquidity, $23b in debt and $16b as good as spent to keep the turnaround on track until 2009, these cash burn issues are troubling, to say the least. Ford's stock reflects these concerns, currently down nearly 7 percent on the day. Paging Captain Kirk!