Rumor has it Rick's toast. Obviously, there's no way to officially confirm GM CEO Rick Wagoner's termination by GM's Board of Bystanders. But I want to state here, and for the record, that TTAC flagged Rick Wagoner as the wrong man at the wrong time in the wrong job from the moment we began our industry coverage. To those who say Wagoner made the best of a bad job, I call bullshit. The General Motors Death Watch and GM's financial record offer incontrovertible proof of Wagoner's ongoing managerial malfeasance. If nothing else, consider the fact that his administration relentlessly pursued a "we can cut our way to prosperity" philosophy. In this Wagoner has been deeply misguided. And misguiding. The CEO's failure to face the facts, both within GM and without, identify him for all time as a weak, ineffectual leader. Wagoner's lack of accountability– both personally and professionally– stands as an utter condemnation of GM's Board of Directors and America's "old school" corporate culture. Wagoner has pocketed over $100m and secured a bankruptcy-proof pension for himself and his heirs. His real legacy will be the psychological despair and economic misfortune of the one million-plus people whose livelihoods depend– depended– on General Motors' health and vitality. I'm sure Wagoner is a nice man, personally. I've never met a CEO of a major corporation who wasn't (and yes, I've met a few). But it's good riddance to bad rubbish.

Despite predictions to the contrary, Honda reported a sales loss this month compared to July 2007, down 1.63%. Total car sales went up 14 percent, but were outweighed by a 22 percent drop in truck sales. Accord sales led the pack with a very healthy 41,382, Civic further behind 29,125, and both up over the year before– but not enough to boot Ford F-Series from the sales throne. Fit posted an all-time high at 12,266, and Acura's sole bright spot was a 25.6 percent rise in TSX sales. Almost every other vehicle was down by double digit percentages, including all CUV's.

No excuses needed here. Nissan's sales are back from the dead. (Did someone say truck incentives?) Even with three fewer selling days for July 2008, Nissan division sales were up 9.9 percent (unadjusted) over last year. Versa and Sentra's double-digit percent sales increases led the pack, Altima sales were basically unchanged at an impressive 24,429, and the brand spanking new Maxima was up a few percentage points from last year. Truck/CUV sales were up, thanks to sales of the new Rogue as well big gains by the Frontier, Pathfinder, and Quest (all three vehicles were roadkill last month). On the other hand, Infiniti sales were down 2.9 percent; all cars save the G Coupe had declining sales. Rising sales of the new(ish) EX and FX CUV's were not enough to offset the drop in cars sales.

As TTAC's Black Friday Redux coverage gathered pace, I paused to read a USA Today profile of VW's new U.S. boss. If you don't read the article too closely, you'll think that Stefan Jacoby is ideally suited for the job of resurrecting VeeDub's American fortunes. Jacoby makes all the right noises: no wafty American style VW's, better quality products, my VW Beetle convertible got me laid when I was in college, etc. Any German who describes himself as a "non-German German" is clearly sensitive to the cross-cultural issues the scuppered his predecessor's shot at popularity (and invite some serious psychological profiling). But it's what Jacoby doesn't say that's worrying. At no point does he acknowledge the complete and utter shafting U.S. VW dealers have given their customers. (Not all of them; yada, yada, yada.) While we dissect the dissolution of America's automakers, it's important to remember that the situation is even worse at the sharp end. Until VW– and everyone else in this biz– realizes that they've got to repair their dealer – customer relations, there will be little long term loyalty to be had. 

After two months of declining sales, analysts are losing faith in the European market. They predict that the down cycle could last until sometime in 2009. That's bad news for everyone, but it comes at a particularly bad time for America's automakers, who are banking on overseas sales to make up for a moribund US market. The Detroit News reports that Europe accounted for nearly a quarter of GM's global sales last year at 2.2m units, while Ford's (non Jag/Landie) brands sold 2.4m vehicles in the Eurozone. And though overall European sales are down only two percent on the year, declines have been increasing, with eight percent drops in May and June. The European automakers' association predicts a 2.7 percent decline this year, though individual executives say it could be as much as four percent. "Having seen the developments in some European markets in the last six to eight weeks, I think it could be worse than that (four percent decline)," Daimler's Dieter Zetsche told analysts during a quarterly earnings conference call. Even the once-hot eastern European markets are declining, eliminating further opportunities for European sales growth. Which means the D3 have less opportunity to squeeze sales from abroad while the American market corrects itself. Not good.

The newswires and blogosphere are flooded with stories about average Americans and the sacrifices they have been forced to make by high fuel costs. But what about the federal government? Are all the Presidents men cutting back on fleet size, fuel consumption or general wastage? Of course not. The Detroit News has some analysis of General Services Administration data, which says that the Government's vehicle fleet costs taxpayers $3.4b per year. For comparison, the proposed $25b in loan guarantees to bail out the Detroit 2.8 will "only" cost taxpayers $3.75b. So what's driving the high cost of government fleet use? Well, at the Department of Housing and Urban Development, they aren't sure. Fleet costs at HUD have jumped nearly 70 percent since 2004, to more than $2.1m last year. But during the same period, the agency cut its fleet size and fuel consumption. "Where that spike in overall costs came from, I have no idea," said Bradley Jewitt, director of HUD's facilities management. Meanwhile, the Department of Interior was told by its accountants to reduce inventory. And so it's increased its fleet. (Hey, the VA managed to just plain lose a car last year.) Get this: Secretary of Transportation Mary Peters has two chauffers, who made a combined $128k last year. HHS Secretary Michael Leavitt has one driver who earned $90k last year. So times may be bad, but at least your government is healthy enough to waste your money.

Ouch. The Summer of Detroit's Discontent (not to mention everyone else's) continues to hammer the worst laid plans of truck-heavy automakers. And while everyone gives FoMoCo CEO Alan Mulally credit for being the most "realistic" of The Big 2.8's helmsmen, he ought to have a word with his PR department. Do they really think headlining their all-caps press release "FORD FOCUS CONTINUES TO SURPRISE, OUTPACE SEGMENT" is going to distract anyone from the fact that Dearborn's darlings' overall sales are down by 14.7 percent versus last year? On second thought [via The Detroit News]… "Car sales were up 7.8% in July compared to a year ago. Meanwhile, sales were down 7.8% for crossovers, 54.4% for SUVs and 18.1% for pickups and vans." FYI, Focus sales (a horrible car by my snobby estimation), totaled 15,200 units. Toyota shifted 34,438 Corolla's in the same time period. Just sayin'.

Click here for Ford's sales press release 

(Note:  The numbers in the press release are adjusted for sales days, so they will vary from the unadjusted numbers reported here.)

OK, that's not the real name of Chrysler "We Don't Need No Stinkin' Leases" program. It's "Shop 'til You Drive." You have to admit: it's a lot less catchy than our version. I mean, I'm not quite sure how the ChyrCo message parses. Shop 'til you drive away? Shop 'til our salesmen drive you nuts? No se. Here's ex-Toyota and current ChryCo Prez Jim Press' official explanation [via Automotive News, sub]: "We are leveraging the move from leasing to retail purchases to offer our customers the best deals of the year and make buying as affordable as renting." No way Jose! Anyway, the bottom line: 40 percent off sticker for the Ram, 25 percent off MSRP for the Aspen, 24 percent off the Town & Country minivans and 28 percent off Grand Cherokees. Chrysler Financial is offering up to $2k cash on "select" retail purchases and expanding its 72-month financing. Apparently, Chrysler "Celebrates August Retail Purchase and Finance Enhancements." Please don't tell me a Lionel Ritchie soundtrack is heading our way…. 

Click here for "Shop 'Til You Drive Sales Event" press release  

Last month, I brought you the shocking news that local Dodge dealers were marking-up Charger SRT/8's by $10K, or more. I recently revisited the same OK (as in the state) dealer, after a tip-off that they had several pre-delivery Challengers on the back lot. Sneaking on scene with sets of "borrowed" Challenger keys, I passed the same two SRT/8 Chargers that were gracing the showroom floor 30 days prior. They'd painted "Hail Sale!" on the windscreen. A large hail storm had turned their sculpted rears into cellulite infested thighs. You can now pick one up for $38K or so, and 0 percent financing (but no leases). As for the Challengers, seeing them in the metal changed my opinion. They're a sight to behold, with menacing faces and near perfect proportions. The seats are incredibly comfortable, the dash sports soft touch plastic. And the bad news: the  build quality sets new lows, even for Chrysler Corp. The paint on the rear bumper didn't match the fender. The metallic grain flopped in numerous places, and the panel gaps were uneven on the trunks and passenger doors (on all three models). So I guess the Challenger is the most faithful rehashing of the 70's muscle car yet. Stay tuned for a full Challenger review; Sajeev Mehta has his own insiders. And yes, they marked up the Challengers by $20K.

Even Autoblog knows something's not right when GM announces a $15.5b second quarter hit. ("We're no industry analysts and we don't have any insights into the General's balance sheet, but a $15.5B Q2 loss and four strait [sic] quarters of red ink doesn't sound good at all.") Well, you don't have to be an industry analyst to know that GM's Attention Deficiency Disorder accounts for a large part of its misery. Representing our Best and Brightest armchair analysis semi-pro squad, I'd like to point out that Larry Burns, GM Veep R&D and planning (yes planning), does his employer no favors when he steps on the GM Fastlane Blog soapbox and declares "GM believes there is no single technology solution to displace petroleum." So compressed natural gas it is! "Natural gas, is enticing because it is abundant, affordable and relatively clean." Only… "We are not ready to commit to a future production plan." So, Larry, how do we get this party started? "If natural gas is to make a measurable impact, many vehicles need to use it, and it must be readily available. Collaboration with the energy industry and governments is key. Governments will likely need to provide incentives to encourage early adoption of the technology and to jump-start the fueling infrastructure." Will these guys EVER learn? Nope.

Never mind what they said before. GM is joining Chrysler on the huge-incentives-for-2008-trucks bandwagon. Starting today, they'll bump the rebates on GMC Yukons, Yukon XLs, Chevy Tahoes and Suburbans from $2k up to $6k. And get this– the Hybrid models are included. Envoys and Trailblazers will get the same $6k discount, with another $2k tossed in as a lease "pull-ahead" bonus. Avalanches and crew cab/extended cab trucks have $5k cash on the hood. In lieu of the rebates (or in addition to, in some cases), they're also offering low-to-no-percent-interest financing. On the car side, Chevy's offering 0 percent financing for 48 or 60 months on Corvette coupes (including Z06) and convertibles, respectively. Pontiac is bribing offering buyers a $1k bonus on the G8 sedan. Other GM models offer varying interest rate and/or nominal cash back offers. However, according to Automotive News [sub], GM spokesman Pete Ternes warns these figures could change "after GM releases its [Q2] earnings." If anything, you can probably expect them to sweeten the deal in a last ditch, damn-the-profits attempt to clear the '08s from dealer lots.

It's hard to believe that General Motors was once the world's largest company. It's even harder to believe GM was once the world's most profitable company. If there's one factor connecting the GM money factory of old with today's sinking ship, it's a sense of a boundless (senseless?) optimism married to a mien of manifest destiny. One wonders if GM could produce something as… seamless as this PR piece today. Sadly, yes. [Any resemblance between this film and a hypnotic smoking cessation video are entirely obvious.]

In a not-so-stunning piece of preemptive PR– before the July sales data hits the fan– Chrysler CEO Bob Nardelli has told his troops that more fuel-efficient vehicles are on their way. The Detroit News reports Nardelli's four-wheeled fuel-sipping cavalry could arrive as early as next year, "possibly including an unexpected model to debut next year." Less specifically, "You very well could see some new platforms, some new vehicles out next year," Nardelli told reporters at a dealership dedication. The aggressively conservative head of the ailing American automaker also took the opportunity to introduce a new euphemism. "We continue to reprioritize our capital," Boot 'Em Bob reassured. "To make sure we are responding to one of the most significant changes we see in consumer buying preferences to downsize and look for fuel efficiency." Will a previously-conjectured partnership with Italy's Fiat or India's Tata Motors or Japan's Nissan or France's Renault or the UK's Ultima [just kidding] deliver this much-needed Chrysler product or products? To quote a Disney movie I can't recall, Mmmmmmm. Could be. Or better yet, Bob himself: "Partnerships with other automakers could be part of those new product introductions." So now you know. Ish. 

Which vehicle is not cheap, not particularly roomy or comfortable, but can go round a bend like no other hatch?! It's the only car in its class with a classic layout, the BMW 1-Series. It has been accused of completely sacrificing comfort and practicality, yet it produces Joker-like grins on the track. It could have been front wheel driven with a transverse engine and a big ass to accommodate five plus luggage, but don't we already have enough of those? Yes, it's true it's priced closely to the 3-Series but offers less. However, if you are young and naive things look a little different. It's a "lifestyle" vehicle, and a successful one so far. That's why I think the next gen 1-Series will stick to the same philosophy: compact enough to be useful in the city, Bimmer dynamics, and expensive enough to make a wealth statement. Design-wise I'm bet on a more aggressive stance featuring the new BMW uber-grille, LED lights and flame-surfacing creases.

[For more of AA's photochopistry, click on www.avarvarii.com]

Detroit's engineering mules are often spared from the crusher, reborn to teach engineering students in leading universities across the country. During my (short) stint with Mechanical Engineering, pre-production iterations of GM's famous small block V8s were at my disposal. Whatever. That wasn't shit compared to what's tucked away in a lonely basement of the famous Kettering University in Flint, MI: a GM EV1. It was there as of last May, and it was blockaded by a bunch of crap, so it's not leaving any time soon. It looks like the Posner-approved machine's supposed death has been somewhat exaggerated. And good ideas never die. They just gather dust.