A friend of mine killed a motorcyclist Sunday night. He was so out of it, either on beer, vodka, blow, crack, meth or god only knows what, that he simply drove into the young biker from behind on Route 9W, fast enough to squash him dead. Early word was that Jack left the scene, but if so, it was probably only because he was in a stupor, since at least the police don't seem to be charging him with that. He is in the county jail, though. Everybody in our small town knows that Jack is a doper and a drunk. He's the genial alcoholic still drawing from the reservoir of sympathy established when his own 16-year-old son died instantly in a car-versus-tree accident while racing a friend on a dark back road. It was long enough ago that my wife, who biked past the tree yesterday, said the “shrine” is gone— a football, a deflated party balloon, a small white cross, some faded we'll-miss-you-Bobby signs. At least we kicked Jack out of the ambulance corps, where he was one of our drivers. But there was even argument about that. Could we do it without proof, without specific evidence? Well, how about numerous arrests both for DWI and possession? Yeah, but… One of the frequent arguments against permanently suspending a confirmed drunk's license is that you're removing his or her livelihood. You're turning them into a contractor without a pickup, an appliance repairman without a van full of tools, a commuter stranded 30 miles from work. Last week, I watched the cleaning lady from our fancy health club climb wearily into a taxi in front of the gym's big marquee. I barely knew there were cabs in our small town, but the cleaning lady apparently couldn't afford a car and paid fares twice a day to get to and from work. Maybe the suddenly truckless contractor needs to find a new line of work and call a cab. I'm sure at least one 20-year-old motorcyclist would have agreed.

The automakers whining lobbying in Washington seems to be paying off. The Detroit Free Press reports that 71 members of the House of Representatives have said they'll support the Advanced Technology Vehicles Manufacturing Handout Initiative. The $25b program's meant to help the domestic automakers catch up with the transplants meet the 2020 CAFE standard of 35 mpg by giving loaning them money to engineer fuel-efficient vehicles or upgrade old plants. Rep. Sander Levin from Michigan explained, "Funding this new program is critical to the future of the U.S. auto industry, as well as our nation's efforts to reduce our dependence on foreign sources of oil. The federal government must be an active partner in the effort to create these jobs and technologies here in Michigan the United States." Several members of the Senate have also expressed support for the program, including Sen. Barak Obama (surprise!). But the chances of it (or anything else) being passed this year are slim. Congress will start their August vacation recess this week; they have no plans to convene after the election. That leaves only September for them to get anything done. As if. [thanks to carveman for the link]

Anyone remember the Monty Python sketch where lost explorers say "Hang on a minute, if we're lost, who's filming us?" And then they're shown greeting the camera crew. And then they repeat, "Hang on, who's filming them?" And reveal another camera crew. Well, you gotta give the Flying Circus credit for prescience. Pistonheads reports that "Angry motorists [in Lancashire] have twice torched the £24,000 speed camera, which is situated on the B5246 at Mere Bow, and last week it was pushed over. Now Lancashire Partnership for Road Safety is threatening to put up another camera to monitor the Gatso." The ire might have a little something to do with the fact that the Lancashire po-po had to rescind 545 speeding tickets for "improper calibration." Anyway, this would not be the UK's first camera-on-camera action. In fact, the most up-to-date UK speed cameras have a built-in security camera, and automatically notify the local constabulary when they're under attack. So the latest motto from The Land of Hope and Glory's glorious leaders must be "Tough on crime, tough on people inspired to commit crime by policing policies designed to raise revenues and punish otherwise law-abiding citizens, for their own good."  

Last Friday we took a look at the future Audi R4. I told you how VAG plans to cook several dishes with the same ingredients. The house special will be served by VW, which already teased us with several appetizers (see: Concept R and the EcoRacer). The production VW MR should be situated somewhere between the two concept cars. The R was an aesthetic study that previewed the new VW stylistic approach for the beginning of this decade, while the EcoRacer was more engineered than designed (its looks seem to have been compromised for efficiency). With Audi assembling the sports-luxury version of the car, and SEAT going for the sports-latino market share, we can imagine that VeeDub will get the eco-model. That is, of course, if they don't throw in an MR Skoda as well. We won't mention the Boxster/Cayman because the situation is already too complicated. Long story short: expect a VAG mid-engine sports car for every taste and wallet with the VW model, depicted here, being the most affordable both to buy and run.

While some of TTAC's Best and Brightest adopt a "rot in Hell" stance regarding HUMMER's imminent demise, pity the poor dealers. Speaking with Automotive News [sub], HUMMER Sacramento store owner Mike Daugherty said $4-a-gallon gasoline took away about half his biz. The other half disappeared after GM announced it might sell the brand. Yup. In June, Hummer sales fell 59.3 percent to 2,072 units. Obviously, GM CEO Rick Wagoner knew his "strategic review" proclamation– and subsequent withdrawal of all corporate support– would scupper HUMMER. But underhanded bastard clever man that he is, Wagoner also realized that dangling hopes of a HUMMER buyer would keep the dealer payoff price down. Wagoner mentioned a mystery buyer at the time of the first knife thrust. Since then, GM's paying HUMMER dealers "advanced sales bonuses" and buying them out, hoping to avoid the blizzard of lawsuits that accompanied Oldsmobile's termination. On Friday, Rick twisted the knife again, repeating the HUMMER sales rumor. "We have some interested buyers," Rick said [via Reuters]. "And I can't tell you anything beyond that right now, but we are moving as fast as we can." Believe it or don't.

A couple of weeks ago, grainy images portending GM's bright, small-car-driven future "leaked" onto the Web. "All hail the new Cruze!" shouted the GM Kool-Aid Klub, apparent fans of intentional misspelling. A compact come-to-Jesus from the higher-ups quickly followed, delivered by GM's Design Chief. "In North America, we never did a good small car," Ed Welburn mea culpaed. So things will be different this time, right? Just like they were going to be different three years ago, when the Cobalt was released? The Cobalt I rented this weekend? Bah, humbug, I say.

Our previous blog post made the connection between China's increasing demand for imported oil, The People's Republic's subsidies for the black gold ($40b p.a.) and the policy's inflationary effect on U.S. gas prices. Common sense (and The New York Times) suggest that other "managed economies" are using the same pro-growth strategy, amplifying the inflationary effect on world oil prices. "The oil company BP, known for thorough statistical analysis of energy markets [excellent hat tip to Big Oil!], estimates that countries with subsidies accounted for 96 percent of the world’s increase in oil use last year — growth that has helped drive prices to record levels." Hey, what happened to "Let's all blame the evil speculators?" Anyway, you think the U.S. is "addicted to oil?" Malaysia spent 7.5 percent of its economic output on oil subsidies. Indonesia shelled-out $20b this year to keep prices down. And where there's no political will to let the free market do its thing, there's no way they'll stop. "You talk about subsidies, you’re not only talking about the economy," asserts Purnomo Yusgiantoro, Indonesia’s minister of energy and mineral resources. "You’re talking about politics.” I.e. his job. So they're damned if they do, damned if they don't. And for this you pay at the pump. [thanks to OldDavid for the link]

After accusations of "betrayal," blockades by the Canadian Autoworkers union, threats of lawsuits against the union and sops tossed to the union, GM is moving ahead with plans to close their truck plant in Oshawa, Ontario. However, it looks like it'll cost them a bit more than they'd anticipated. The Globe and Mail reports GM and the CAW have struck a deal whereby GM will add another model to the mix produced at the auto assembly plant there. Oh, and pay some workers for four years after the plant closes. The complete details of the deal will be announced to workers later today, but it includes paychecks for laid-off workers with 26 years seniority for four more years at 65 percent of their current wages. That makes them eligible for "a special retirement incentive applicable to people with 30 years of experience." Workers with 27 to 30 years would also be paid until they reach the 30-year mark. In return, GM gets to keep building cars in the most expensive location in North America. Such a deal!

Those who claim that the current price of oil is a supply – demand deal have some new ammo. Industrialinfo.com reports that The People's Republic of China imported 90.53 million tons of crude oil in the first half of 2008, up 11 percent over the same period last year. And you know all those dollars we send over to China to build the cheap stuff we buy at Wal-Mart? A big chunk of that went to "Angora, Saudi Arabia and Iran" [sic]. "The value of imported oil rose to $64.98 billion, representing a dramatic 85.8% increase in costs." Although China exports some oil (2.37m barrels worth $1.42b), experts reckon the percentage of imported oil will continue to rise. The only possible brake on Chinese oil consumption: the lowering of government subsidies. The New York Times pegs that number at $40b per annum. So far, nothing much happening on that front. All of which means the current status is likely to remain quo. 

Good morning participants in TTAC's fantasy GM Car Czar (WTF Edition). Remember when GM announced they were going to build the Beat sub-compact for U.S. Chevy dealers– and then not (too expensive to import)? Well I hope you didn't toss out the cards for the Beat mini-cars' brethren. Automotive News reports that GM now plans to replace the current Aveo with a hecho en Mexico version of the Groove or Trax by 2011. Product-addled Chevy Veep Ed Peper refuses to narrow it down any further. "Of the triplets, we will get one of those variants, I don't want to say at this point." Peper also warns U.S. mini-car fans that the final vehicle will be "very similar to one of those vehicles but larger," in part to meet U.S. crash test standards. The supersized mini-compact will be built on the gamma platform. Oh, and the Cruze will replace the Cobalt. Still, best to save those cars. I mean, cards. 

Hang around the car business long enough and you're bound to get some weird offers. Maybe something along the lines of, "If you fly to South Carolina and 'judge' some 70 odd cars, we'll give you $50." And so your honor, this is how I found myself standing in soupy 90 degree plus weather pounding on the hood of a 325e (or five) demanding to know how they got such a fine automobile for $500 or less. Murliee Martin and myself did an adequate job of busting the more obvious cheaters (we hit a spec Miata with a 200 lap ding and some got that tried to sneak in a supercharged PT Cruiser with 70 demerits) but a few slipped through our clutches. Namely the #1 and #2 cars, a BMW 318i and Saab 900 Turbo, respectively. In fact, the track employees were quite shocked as to  how we let the Swede slide by. Guess we got distracted by something. Oh, did I tell you that they let me drive the pace car, a Vitamin C Dodge Challenger SRT-8? They did. And to think, my Mom's still bummed I didn't go to law school.

When it comes to government-mandated corporate average fuel economy (CAFE) regs, I'm with GM Car Czar Bob Lutz. It's like forcing a clothing maker to sell smaller shirts to get people to lose weight. If you want to reduce obesity, just raise the price of food. [My add; even MB knows you can't threaten to starve people for their own good.] In any case, no matter what MB and his employer's representatives say, they have a consistent record of gaming the system. Flex-fuel credits anyone? The U.S. "light truck" CAFE exemption is/was The Mother of All Loopholes. (Who says there's no such thing as karma?) And now GM's playing the angles in Europe. The Times reports that UK PM Gordon Brown's entourage arrived at the London Auto show in some Indian sedans and SUVs and dangled £90m of UK taxpayer money for electric automobile development. Over five years. Available to someone. Depending on something. To which GM Europe Prez Carl-Peter Forster responded fuck that shit [paraphrasing]. GM's wants a national sponsor for a "super credit" scheme that would allow ultra-low carbon-dioxide vehicles (below 50g/km) to offset larger and more polluting models. "If Britain was prepared to champion this idea within the EU, GM would consider making its electric vehicles at the Ellesmere Port plant on Merseyside." Sweet.

From GM's 10k filing… "Under the residual support program, the customers’ contractual residual value is adjusted above GMAC’s standard residual values. We reimburse GMAC to the extent that sales proceeds are less than the customers’ contractual residual value, limited to GMAC’s standard residual value. As it relates to U.S. lease originations and U.S. balloon retail contract originations occurring after April 30, 2006 that GMAC retained after the consummation of the GMAC sale, we agreed to begin payment of the present value of the expected residual support owed to GMAC at the time of contract origination as opposed to after contract termination when the related used vehicle is sold. The residual support amount owed to GMAC is adjusted as the contracts terminate and, in cases where the estimate is adjusted, we may be obligated to pay each other the difference. As of December 31, 2007 and 2006, the maximum additional amount that could be paid by us under the U.S. residual support program was $1.1 billion and $276 million, respectively… We will also pay GMAC a quarterly leasing payment in connection with the agreement beginning in the first quarter of 2009 and ending in the fourth quarter of 2014. At December 31, 2007 and 2006, the maximum amount guaranteed under the U.S. risk sharing arrangement was $1.1 billion and $339 million, respectively. The maximum amount would only be paid in the unlikely event that the proceeds from all outstanding lease vehicles would be lower than GMAC’s standard residual rates, subject to the limitation. As of December 31, 2007 and 2006, we had a total reserve recorded on our consolidated balance sheet of $144 million and $50 million, respectively, based on our estimated future payments to GMAC associated with the maximum amount guaranteed under the U.S. risk sharing arrangement."

Well, finally. The Blue Oval Boyz promised to unveil a new product plan for their Mercury brand on the same day their financials were revealed. Nope. I guess FoMoCo didn't want to steal the "thunder" of the press release re: the 2010-or-bust-and-maybe-even-then Mexican-built (but Euro-style) Ford Fiesta and Focus. Anyway, enough scene setting (it was a dark and stormy car market). Here's Mercury's new theme song, as sung by Derrick Kuzak, Ford's global product chief, [via The Detroit News]: "Ford Motor Co. will reposition Mercury as an entry-level premium brand that will support Lincoln [which] will no longer get any smaller vehicles, as had been planned, while Mercury will only get smaller cars and crossovers." In practice, the Sable dies, the Mercury Mariner and Milan live (with hybrid versions) and the brand gets a new, new-Focus-based sedan as and when. MA Lincoln Mercury dealer Chris Lemley responded to the revelations from the bowels of the Faint Praise Department. "Not only is some product news better than no product news, but some Mercury strategy is better than not having one." How great is that?

We hear from various sources that GM is about to follow Chrysler's lead and stop leasing its vehicles in the North American market. The move is not entirely unexpected; the company that owns the now non-leasing Chrysler Financial– Cerberus– also owns 51 percent of GM's vehicle financing arm, GMAC. Canada's Windsor Star reports GM's no-deal as a done deal. "The financial arms of Chrysler LLC and General Motors Corp. are getting out of the business of leasing vehicles as credit tightens and resale prices for gas-quaffing trucks fall, according to company executives and independent sources." Quaffing? Don't all ICE vehicles quaff? Anyway, the lease cessation is bad news for ChryCo and GM dealers north of the border. "In Canada, an estimated 43% of drivers lease their vehicles, double the U.S. rate of 20%." Ouch. You know residuals are in free fall when a financing company walks away from that kind of action. Meanwhile… "Geoff Helby, an analyst with J.D. Power & Associates in Toronto, said Toyota Motor Corp. and other automakers that offer attractive lease rates and decent residual values could win more business from the Detroit automakers as a result of the move. 'It would definitely put Chrysler and GM at a serious disadvantage.'" Make that "will."