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By on July 13, 2008

Less of this? (courtesy images.dradjust.com)iCasualties.org reports 4118 U.S. military deaths in Iraq from March '03 to July '08. In 2005 (the last year where full data is available), 43,443 American died in road accidents. The rate of deaths per 100 million miles driven has steadily decreased. But the increasing number of miles driven means that the total number of fatalities hasn't changed much over the past few decades. Get those drivers to drive less… ScienceDaily reports that Michael Morresey put together some tables on the topic. The public health professor at the University of Alabama reckons a 10 percent rise in the cost of gas trims traffic by 2.3 percent. His calculations suggest that $4/gallon gas equals 1k fewer monthly U.S. road fatalities. It's not clear if Morresey's assumptions factor in the effect of automobilists switching to a pair of wheels (with a much higher fatality rate per miles driven). It'll be a few years before we get the bottom line.

By on July 12, 2008

GM\'s future bank balance?Even though I disagree with him more often than not, I like Terry Box's writing. If such a thing is rhetorically possible, The Dallas News car correspondent thinks outside-the-box. He's also a true champion of blue collar consumers. So when I caught a link to his coverage of GM CEO Rick Wagoner's appearance at a Dallas luncheon– where Rabid Rick's dropped his infamous and ineffective "inaccurate" bankruptcy rumor remarks— I knew we'd get some additional insight into Wagoner's thinking, or lack thereof. Box flags the fact that Wagoner reckons GM's Arlington will be GM's sole SUV supplier. "We think the segment will be big enough to support a plant," Mr. Wagoner assured his Lone Star State admirers. Think? But here's the real money shot: ""We used to do cars and everything else – with everything else being trucks. Now, we are moving toward three channels: cars, trucks and crossovers." Parsing that, it seems Wagoner still doesn't get it: America's future is predominantly car-shaped. Or does he? "Our job now is to get our cars more profitable," Wagoner announced. And how, pray tell, is he going to do that? Oh sorry. The answer would require a coherent turnaround plan with publicly stated goals. Why start now?

By on July 12, 2008

David Schmidt, Kevin Blake, David Arrow, Cameron Francis, Mark Sexton, Brian Williams, Timothy Altmeyer and John Felix in Gross Indecency: The Three Trials of Oscar Wilde (1999)According to The Gainesville Sun, Mark Sexton was the director/actor for the local Hippodrome State Theatre. In August 2004, Alachua County hired Sexton as their official, part-time spokesman, at a salary of $50,298 (now $59,475). After a couple of tropical storms, County Manager Randall Reid authorized a county-paid car for Sexton AND "unlimited use" for his personal Prius. So now… "The accident happened on Christmas night 2006. Sexton was on vacation in Miami when he struck Miami Beach resident Felix Lopez while Lopez – who was dressed as a woman – was crossing the street. A police report states the officer was unable to determine who was at fault and that no injuries were reported at the scene. Sexton did not tell county officials of the accident until about a month later, when a legal notice was sent to the county. Lopez has since sued the county. Commissioners discussed whether to defend Sexton in the suit and eventually decided to do so. Sexton said he had consulted an attorney and threatened to sue if the county did not defend him." Needless to say, this is just one example of the nationwide scrutiny suddenly facing government workers' use of taxpayer-funded vehicles (e.g. LA County's $433m fleet of 12,780 vehicles) now that gas prices have soared. As for Sexton, "he doesn't remember how much gas was in the tank when he left for Miami but added he is pretty certain he bought gas with his own money during the trip." And no, this is not the plot of a Carl Hiassen novel.

By on July 12, 2008

Marky P.\'s personal whip. You want to talk about high gas prices? Hertz used to charge its customes $7.99 a gallon to refuel a car. In an interview with The New York Times, the rental car company's chairman and chief executive says Hertz has modified the charge to stop gouging their customers [paraphrasing]. "We are now reducing that to the pump price, which is $4 or so, plus a one-time fee of $6.99," Mark P. Frissora reveals. "We also have a fuel-purchase option. In the past, if you elected to buy the tank of gas in advance, we charged a 10- to 20-cent premium on that tank. But now we give a 15-cent discount to whatever the price is at the pump." Hertz is hoping new customers will cover the lost revenues. But what about the old biz, the vacationeers facing pump shock? "In general, gas prices going up is not a positive thing. However, it is not nearly as negative as you might imagine in rental car land. Typically, the rental car itself and gas are no more than 10 percent of the overall cost of a vacation. We are finding that people aren’t cutting vacations right now. You would think that with gas prices being high, there would be a deterioration, but we haven’t seen that." Yet. In other news, Hertz has just 3k Priora in its Green Fleet; Toyota's hyrbid's residuals are safe. For now. 

By on July 11, 2008

Gallons per mile (courtesy motorplex.ae)I was a little taken aback by the new Mercedes SL65 AMG Black Series' 661hp. I remember when my M5's 400hp was considered excessive. These days, German uber-brutes' horsepower and torque figures are higher than Jeff Spicoli. Obviously, the numbers have no relevance to anything whatsoever. But the whole "how much power does anyone really need anyway" has never been more important– what with CAFE regulations demanding 35mpg fleet averages by 2020. Tom and Ray addressed the question today, when an F-150 refugee obsessed about the power of a Ford Focus vs. a Nissan Sentra. Ray reckons "If you're like most people, and usually drive alone or with one other passenger, and death-defying highway stunts aren't a regular part of your routine, almost any four-cylinder car will provide adequate power." True?

By on July 11, 2008

No blowback?Oh dear. When USA Today car critic James R. Healey finds a car underwhelming, you can bet it has very, very little to recommend it. In fact, Healey is less impressed with the big Lincoln than our Justin Berkowitz. Where Berk praises the MKS' mission critical waftability, Healey says the MKS' ride and handling is "not so good. The former was a bit stiff, even harsh, on moderate bumps in one test car equipped with 20-inch-diameter wheels and their stubby-sidewall tires. The tester with 18-inch wheels was smoother, but still delivered an unpleasantly choppy ride… [The] MKS lacks the firm, lively, well-controlled feel of an Infiniti, which Lincoln says will be a rival. Nor does it match the creamy feel of Lexuses, also potential competitors." Although Healey couldn't top Justin's "Sucko the Clown" description of the MKS' six-speed, the USA Today guy was similarly unimpressed with the cranky cog swapper. So… what then? "It has the right size, features and power. But MKS is not knockout gorgeous, and it lacks the sweet, lively integrity of the best luxury sedans." Ford doesn't have much time to sort-out the MKS' deficiencies. The Blue Oval Boys better hop to it. 

By on July 11, 2008

\"During his long consulting career, Drucker worked with many major corporations, including General Electric, Coca- Cola, Citicorp, IBM, and Intel. He consulted with notable business leaders such as GE’s Jack Welch; Procter & Gamble’s A.G. Lafley; Intel’s Andy Grove, Edward Jones’ John Bachmann; Shoichiro Toyoda, the honorary chairman of Toyota Motor Corp.; and Masatoshi Ito, the honorary chairman of the Ito-Yokado Group, the second largest retailing organization in the world.\"Whenever someone ridicules TTAC's GM Death Watch for cresting a particular episodic number, I ask them to imagine the count if I'd started writing when GM began its decline. For proper mind boggling, cast your mind back to 1946. After spending two years inside GM, management analyst Peter Drucker published "Concept of the Corporation." Although Drukcer's tome praised GM's infrastructure, Drucker suggested that the automaker should decentralize power to autonomous business units. Then GM Chairman Alfred P. Sloan's inability to grasp the implications of Drucker's recommendations marked the beginning of the end for what was once the world's most profitable business. It took more than half a century for GM's fundamental cultural weaknesses to drag it into today's ignominy. And the slouch towards Bethlehem was not inevitable. Or was it? "Management is doing things right; leadership is doing the right things." This GM's CEOs have not done for many, many years. And that's the truth.

By on July 11, 2008

They\'re playing Cerberus\' song.The breakup of Chrysler has begun. It’s been done quietly, in the open, but under obnubilating nomenclature. That last phrase says it all. Why lie when you can make the truth so damn confusing? While Cerberus denies imminent sell-off, a cadre of automotive executives has Chrysler on a hook, passing around a felt tip pen. In fact, a pre-break up party is the only way of explaining some of the crazy-ass deals the three-headed dog has been fetching lately.

By on July 11, 2008

Better looks than the regular SL?Mercedes has revealed its second "Black Series" model: the SL 65 AMG Black Series. The BS lineup of cars (they did realize that, no?) promises to take bonkers AMG models and make them suitable for institutionalization. To wit: the power goes from not inconsiderable 604 horses to a highly volatile 661hp. AMG ditches the folding hardtop (losing some 570lbs. of passion-killing weight) and upgrades pretty much everything else– suspension, transmission, brakes, lease payments. If you can get past the crass body kit, the fixed roof improves the SL's side profile considerably. Deep breath now. If you want to play with Black, you'll need an awful lot of jack: $320k. Plus dealer eBay adjustment? The mind boggles. And the there's the apocalyptic depreciation. Our own Jay Shoemaker when sampling this car's little brother– the CLK Black Series— Jay remarked that it would make a fine used car value. And then he bought a twin-turbo S65 AMG for $70k (review coming). Smart man. 

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By on July 11, 2008

\"I think I\'ll eat some Mondeo sales for lunch\"Ever go to get a haircut, ask for just a trim, and the cutter truly just barely cuts your hair? That's what happened on the 3-Series refresh. The front fascia is slightly revised. But for the most part, we're looking at the same ol' 3-Series we know and mostly love. Or strongly like. The biggest changes for the American version are: (1) a 335i wagon will now be available; (2) BMW is rolling out their dual clutch automatic transmission from the M3 as an option on the 335i coupe and convertible models only (guess on a $2500 price premium over the stick) and (3) the 335d, as in turbodiesel, is coming to America. From that oil burning engine you can pay 5.19 for diesel fuel, but also enjoy 425 lb ft of torque starting at only 1750 rpm and 265 horses. For now, the 335d will be only available configured as a RWD sedan for us North Americans, but the engine is set to land in the AWD BMW X5 as well. To be 50-state compliant, the engine uses the AdBlue urea injection system co-developed with Mercedes and VW. Expect the updated cars to be '09 models shipping early fall.

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By on July 11, 2008

A bridge too far?"[Cutting-back on U.S. light truck production] shows that Toyota is just as fallible as anybody else,” said Joseph Phillippi, a principal of AutoTrends Consulting. “They’re human after all.” Well gee, who'd a thunk it? I guess former Detroit News cheerleader (now ace New York Times scribe) Bill Vlasic couldn't resist putting the boot in, as the Brits would say. To be fair, the article is extremely fair in its assessment of the relative impact of the SUV/pickup truck extinction on the Big 2.8 vs. Toyota. And we get another glimpse of what makes Toyota the Automaker in Front. “By using this downturn as an opportunity to develop team members and improve our operations, we hope to emerge even stronger,” claimed Jim Wiseman, ToMoCo NA's external affairs Veep (sounds sexier than it is). Happy talk? "They have piles of cash and are as flexible as any company in the industry,” said analyst Maryanne "Where's GM's Sense of Urgency?" Keller. “This is probably a good thing for Toyota because, in their history, they have shown that adversity is what makes them stronger.” Not to mention the fact that doing less badly than your competition is the same as doing better. 

By on July 11, 2008

Say hello to my leetle Honda! (courtesy denofgeek.com)If not for pencil-necked Oklahoma, Kansas would share a border with Texas. But the two states shared a laugh today, as the Kansas City Star told its readers about a couple of flat-footed Dallas cops who've been driving around with a gigantic stash of coke. At least technically, the Class A drug wasn't theirs. "An officer cleaning the car at a patrol station Wednesday discovered the nearly 50 pounds of cocaine hidden in hydraulically controlled compartments. 'These compartments have recently been more and more popular with drug operations,' said Deputy Chief Julian Bernal, commander of the Narcotics Division. Dallas police put the two-door, 2004 black Infiniti into police service May 7 after seizing it at a drug house, where they also found a 1999 Honda." And the Honda's important because…? "The Honda was sold at auction. Bernal said police planned to contact the person who bought the Honda to find out whether drugs are hidden in that car, too. They are also trying to find out who owned the cocaine they have been driving around." Sounds like a plan to me.

By on July 11, 2008

The next Acura?Honda got out of the supercar game when they discontinued the NSX in 2005. However, spyshots and gossip indicate they're about to get reenter the fray. By 2010, HoMoCo's supposed to show us another "New Sports eXperiment." Unfortunately (or not) the newcomer will no longer be mid-engined (I guess they learned that's "sacred territory"). Instead, the engineers will opt for the "GT approach," aiming their range-topper at the Lexus LF-A, Nissan GT-R, and (with some luck) European GTs. Camouflaged test vehicles show a sharp nose and dynamic side-line. The whole assembly reminds me in silhouette and proportions of the LF-A. I can say the same for the NA V10 engine. Let's just hope it doesn't turn out to be another "Not So eXotic". 

By on July 11, 2008

Just the thing to impress them at the old ball game"OMG! It's Paris Hilton's car!" The bikini-clad blond with waiting-for-a-nuclear-blast sized sunglasses was impressed by the big black Bentley. "How much does it cost?" "How fast does it go?" "How did you get one?" An Abercrombie of bathing suits gathered around the British-built German car in the late summer sun. I didn't have the heart to tell them they were worshipping a false idol. So what if the Bentley Continental GTC is a four-wheeled Poptart, famous for being famous? Discretion is the better part of valet parking. I'd save my bubble-bursting for the Best and Brightest. And here you are. And here we go…

By on July 11, 2008

GM stock, $9/share.  Mastercard stock, $250/share.  Replacing GM in S&P 500 - priceless.The S&P 100 is the most widely watched index of large-cap US stocks. It's a bellwether for the U.S. economy, a vital component of the Index of Leading Indicators. Reuters reports that the index's managers have punted GM, replacing it with Mastercard. "S&P did not in a statement explain why it dropped GM from the S&P 100." The fact that the automaker's share price has recently slid to 50-year lows, and the international automaker's market cap has fallen from $56b in 2000 to around $5.6b (which means GM NA has a negative net worth), might have had something to do with it. Informed speculation about an impending GM bankruptcy certainly came into play. And now all the index funds that buy the basket of S&P 100 stocks will have to sell their GM and buy Mastercard– no matter what the current price. The news should drag GM's stock price even lower. It's only a matter of time– and not much of it– before the DJIA (Dow Jones Industrial Average) will have to take a hard look at GM's inclusion. If/when, GM gets kicked off that listing, raising money to feed the automaker's cash conflagration will get a lot harder. Leaving federal loan guarantees as GM's only recourse to stave-off Chapter 11. All this before July's sales number and GM's first quarter results. Dark days ahead. 

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