GM has let slip to Automotive News [sub] that Corvette production will cease for the week of Oct. 6. After that, The General will slow the assembly line and lay off an unspecified number of employees (estimated at 75). “It is the first inventory-related closure of the Corvette assembly plant in Bowling Green, Ky., since at least 1995.” While GM spinmeisters were quick to blame the economy, there seems to be something else in play. As AN reports “Through the first eight months of 2008, Corvette sales fell 8.5 percent to 21,066. They rebounded 47.4 percent in August after 2008 models were included in GM’s employee pricing sale. The big-ticket discounts, rare on the Corvette, reduced the car’s inventory glut fast. The Corvette went from a 145-day supply on Aug. 1 — a 2008 high — to a 56-day supply on Sept. 1.” So why not keep on keeping on?  “You can’t count on (the incentives) holding inventories down through the balance of the year,” GM spokeswoman Sharon Basel explained. I know Vette sales are seasonal, but how much money will GM “save” by losing one week’s production, and then cutting output from 18.5 vehicles per hour to 15?

Think GM has it bad? Or that they’re too big to fall? Think again. Lehman Brothers has just announced it’s filing for Chapter 11 bankruptcy protection. The 158 year-old bank decided to exercise the nuclear option after attempts at bailouts and takeovers failed. Lehman Brothers owes $128b in debt, which will probably be paid out at 60 cents on the dollar. (For reference, General Motors has $43b in long term debt). Thousands of Lehman workers were fired immediately after the Chapter 11 filling. The rest were told that they will be paid through Friday, at the most. John McCain – who probably realizes getting New York’s delegates is beyond the limits of reality – told the International Herald Tribune that he was “glad to see that the Federal Reserve and the Treasury Department have said no to using taxpayer money to bail out Lehman Brothers.” Floyd Norris from The New York Times reminds us that Lehman claimed it had ample capital and liquidity as late as last week. Sound familiar? It should. General Motors is in a similar predicament– only worse. Along with Bear Stearns and Merril Lynch, incidents like Lehman are using-up the market’s feelings of shock and surprise at major business failure. If General Motors is hoping for a bailout, they had better get on it soon, or no one will throw money in their direction, even post-C11.

Porsche has released a nice shot of the front clip of its new Panamera uber-sedan. It’s good news and it’s bad news. The good news: it looks like the rest of the Porsche lineup. The bad news: can’t Porsche come up with a new design? They have the 911, which works, and then graft that face onto everything else they make. At one point, the front of the Boxster was considered so similar to the 911 that Porsche worried 911 buyers would go to other brands rather than risk being confused with a lowly Boxster driver (even if the Boxster’s mid engine and proper weight distribution make it the superior driver’s car). So while Porsche experimented with some great designs from an aesthetic standpoint as well as their aptitude for being great behind the wheel (924, 944, 968, 928), the $150,000 Panamera seems to rely on the old faithful maxim for Porsche: everything must look like the 911. Cool yes, but also painfully unimaginative.

As I stated in my post on the new Ford Fiesta, I’m a big fan of the current gen Ford Explorer. As Frank reports in his latest By The Numbers, the gas-hungry SUVs sales have rolled-over and died (so to speal). They’re down by 53.9 percent in August, off by 37.8 percent year-to-date. From a marketing point-of-view, Ford has walked away from the Explorer. When was the last time you saw an ad for one? Ford’s media site has just 11 pictures of the ’09  model, three of which show the sat nav head unit (the new gas cap also receives an honorable depiction). And yet the Explorer a profitable vehicle for Ford (still). It’s a safe, practical, comfortable, reliable, versatile machine. And it’s cheap (high 20’s to low 30’s for the V8). Is that so hard to understand? Or communicate? My suspicion is that Ford can’t launch a balls-to-the-wall “wouldn’t you really rather be driving an SUV?” ad campaign when it’s busy lobbying for umpteen billion of your tax dollars to, at least in theory, build plug-in electric hybrid diesel-powered E85-compatible hydrogen fuel cell gas sippers. It’s a shame, because the Explorer is exactly the kind of highly-evolved, maximum brand equity vehicle Ford should be building. And selling.

It’s shocking to think that The Big 2.8 is lobbying hard and fast for $50b worth of low-interest federal loans without setting forth a coherent plan for what they’d do with the money. (Never mind honestly explaining why they need the “retooling loans” when the transplants don’t.) As much as nature abohors a vacum, automotive journalists can’t stand a dangling modifier. So, once more into the breach dear Horatio! OK, Automotive News‘ [AN, sub] Richard Truett is no Mark Phelan. But Truett’s plan– “How Detroit 3 could put federal loans to work”– lacks a certain something… Common sense? Practicality? Commerciality? We report, you deride. “If the Detroit 3 aim for a payoff within the next five years or so [Ed: what’s the rush?], it’s possible to identify a likely wish list of projects. Here are some possible candidates, starting with General Motors.” According to Mr. T, GM should spend their share of your tax dollars to put The General’s DOA two-mode hybrid into passenger cars, get down and dirty with diesels, make that HCCI engine thing happen and launch the God damn Volt, already. For Ford, Truett recommends plug-in-izing the Escape and Mariner, getting down and dirty with diesels, speeding-up developnment of the ecoboost engine thing and building a fuel cell Edge (huh?). Chryco? Stick the two-mode hybrid into the 300 and Charger, get down and dirty with diesels, and “develop an electric car or perhaps a plug-in hybrid.”

As much as we give The Detroit News shit for their indefatigable cheer-leading, there are times when Motown’s hometown paper surprises us with something roughly akin to journalism. The article entitled “Ford Fiesta draws raves in Europe” starts off with the usual PR-laden ecstasy (without the DJ Tiësto soundtrack). “The Fiesta will give Americans their first real look at what already defines Ford’s cars and crossovers on this side of the Atlantic. It will also be the litmus test for Ford’s as yet unproven theory that American consumers are finally willing to pay real money for a smart, sophisticated small car. ‘This vehicle represents the core DNA of the company,’ Jim Farley, Ford’s chief marketing officer, told journalists gathered here for the European launch of the Fiesta last week. ‘This vehicle is a catalyst for change.’ It also is a lot of fun to drive.” (Our invitation to the Tuscan junket must have got caught in the spam filter.) Then, just when you think you’ve had your fill of bilious boosterism, “The troubling thing about the Fiesta is that it speaks to Ford’s past just as much as it does to Ford’s future, some analysts say. [Me! Me! Oh pick me!] Ford is an automaker that has, time and again, escaped financial Armageddon on the strength of one really good car. The Model A saved the company after Henry Ford allowed the Model T to linger too long without a replacement. The Mustang pumped new life into the company. And the Taurus saved it from the Japanese. Farley acknowledges that counting on one car is a fundamental flaw in Ford’s culture. But he says it is an issue the company is working hard to exorcise. The Fiesta is not a product of that thinking, he said, because it is just the first in a big lineup of compact and subcompact automobiles.” Uh, I think that one– the importance of continuous development– went straight over Jim’s head. Oh dear.

But HOW will it be remembered? TTAC has more than a few automotive historians in our midst. They’re ready, willing and able to identify and anlyze the key moments in the company’s history, leading from complete market and (arguably) world dominance to lost market share and the brink of bankruptcy. (Think how many Death Watches there’d be if we’d started with the dismissal of the federal anti-trust suit that would have liberated Chevrolet from GM.) As we head towards GM’s 100th (tomorrow), The General’s spinmeisters are doing their damndest to promote a corporate history that shows strength, innovation and, above all, continuity (i.e. non-bankruptcy). But not every media outlet is The Detroit News. Some are willing to chronicle the catastrophe, albeit without editorial comment. The AP plays it straight, letting the facts speak for themselves. If history is written by the winners, GM PR’s take will not be triumphant. But it will be interesting.

In Finnish, August is elokuu, the “month of life.” Automakers selling vehicles in the U.S. market missed the irony, as most A) don’t speak Finnish and B) finished one of their worst sales months ever. Even company-wide sales promotions didn’t do anything to put paddles to chest. Ford asked us to “Drive One” (wouldn’t it be more effective if they asked us to “Buy One”?), and GM shared employee pricing (maybe if they threw in the employee health program… ) while Chrysler invited us to “Shop until you drive” (again, where’s the “buy” part?). Toyota and Honda aren’t showing that kind of desperation. Yet. But they still felt some pain. Let’s take a closer look at the katastrofi.

Not content with one cheerleading article telling the world that GM has what it takes to turn around the sinking ship, today’s Detroit Freep Press has another piece asserting that The General will Survive ‘n Thrive™. Mark Phelan’s handed his pom-poms to biz scribe Katie Merx, who pens a paean to the GM Lifer and CEO who’s wiped tens of billions off the automaker’s balance sheet, steered it straight into a sea of debt and presided over the corporate colossus as it’s shed more than ten points of U.S. market share. “He is a finance guy, but he knows he won’t get a healthy balance sheet without beautiful sheet metal.” Gag! “Wagoner is able to focus on select, long-range issues, said David Cole, chairman of the Center for Automotive Research, largely because he has put together a stable and strong senior management team — and trusted them to do their jobs.” Gack! “‘One of the things I’ve learned from Rick and Fritz is you’ve got to deal with reality,’ Chief Financial Officer Ray Young said referring to Wagoner and GM President Fritz Henderson.” Barf. But I’ll let Wagoner have the last word, as the punchline is clear enough. “Our burning desire is to keep going forward fast.”

As GM has singularly failed to focus on a single plan to save the artist once known as the world’s largest automaker from bankruptcy, The Detroit Free Press’ Mark Phelan once again steps into the breach (dear Horatio). Last seen shilling the Chevy Traverse on GM PR TV, Phelan has agglomerated a couple of recent audiences with the automaker’s top brass to winkle-out The General’s strategy, or lack thereof. CEO Rick Wagoner: “‘There are two things we have to do better than anything else,’ Chairman and CEO Rick Wagoner told me this week: design and advanced-propulsion technology.” Like… the Volt! Hence the timeline of Phelan’s lead: “A handful of cars and trucks General Motors will introduce over the next eight years may determine whether the automaker survives to celebrate its 200th anniversary in 2108.” EIGHT YEARS? What’s the rush? Meanwhile… “We don’t know yet what the rest of the upcoming vehicles will be,” Lutz admitted to the Motown cheerleader. “But we know what they have to do: establish GM as a leader in technology, fuel efficiency, design and performance.” And then Phelan sneakily fills in the blank, offering the following without direct attribution. “GM must also finally clarify its muddled brand strategy. Chevrolet and Cadillac must reestablish themselves as global leaders.” (In fact, Phelan suggests GM may “retrench” to those brands without suggesting how that could possibly occur. Cough. Bankruptcy. Cough.) So, that’s better branding, design, advanced propulsion, technology, fuel efficiency, performance, value-for-money and reliability. Just kidding; they didn’t say anything about value-for-money or reliability.

At least this time GM’s Car Czar is sticking to PR Supremo Steve Harris’ talking points. Namely, that The General makes some kick ass cars so give us an effing break (and/or $25b worth of federal loans). On the occasion of 9/11, Maximum Bob Lutz (or his designated spin driver) uses the FastLane Blog to set-up a multiple choice test that proves one thing: nothing. The eight questions– one for each of GM’s U.S. brands, but not really– posit the kind of biased non-queries that would make a GM-friendly journalist blush (albeit only long enough to make his or her way to the open bar). The first three brain teasers challenge readers to rate three vehicles’ “initial quality”– which, as we’ve discussed here ad nauseam, doesn’t mean Jack shit. Number four asks us to believe that, as per the “premier automotive analysis site” (Edmunds), the Chevrolet Aveo is the most-economical car in America, taking into “account not only mileage but all costs” (above the Honda Fit and Toyota Prius). Question five DARES to quote Dan Neil, the auto writer whose prescient anti-GM rant “inspired” The General’s petulant PR folk to pull ALL the company’s advertising from the L.A. Times. Questions six, seven and eight trumpet journalistic circle jerk awards, ignoring sales slumps for the media-blessed vehicles. So, what did we learn? That GM is so busy tooting its horn it still can’t see that the bridge is out.

Pontiac G8 vs M5

Ford CEO Alan Mulally may be a Detroit “outsider,” but the former Boeing executive sure knows how to tow the Motown party line– especially when it comes to securing $25 – $50b of low-interest federal loans. “Speaking on the CNBC cable television network Friday,” Forbes reports. “Mulally said Ford built and sold the trucks because marketplace demanded them. ‘In the United States, Ford’s strategy was to focus on what the customers really wanted, and those were the larger SUVs and trucks,’ he said. ‘Fuel prices were low, the interest rates were low. It’s what the customers chose.'” Oh for Christ’s sake. What about all those consumers who didn’t choose pickups and SUVs? What about the executives’ responsibility NOT put all FoMoCo’s eggs (i.e. billions in profits) into stupid-ass basket case misadventures like Aston, Jaguar, Volvo and Land Rover? I’m no Catholic, but Mually’s reframing of Ford’s former sins, his abject unwillingness to accept responsibility for Ford’s culpability in its current cash crisis, is not what I’d call proper penance. “Ford, he said, has a different strategy now that energy prices have risen, developing a portfolio that includes small cars already on sale in other parts of the world.” Great! So leave my tax money alone and get on with it.

Foodstock-based, first-gen biofuels are becoming increasingly unpopular. And so the European Union (EU) has cut– er, “modified” biofuel goals. Last year, the EU committed to increasing biofuel transport usage to ten percent by 2020. The International Herald-Tribune reports that the goal has been ratified, but a number of caveats have been added. The new plan calls for five percent of transport fuels to be derived from renewable sources by 2015, with at least a fifth of that amount from “new alternatives that do not compete with food production.” When biofuel usage hits ten percent in 2020, 40 percent of that amount will have to come from second-gen, non-foodstock fuels. That goal will be reviewed in 2014. Of course, these plans are worrying biofuel producers; they’re stepping-up a publicity campaign warning that “alternatives to biofuels like hydrogen and electricity – while they might help to reduce tailpipe pollution – still would require burning of fossil fuels to manufacture.” European biofuel producers are worried about the threat of American imports. U.S. farmers receive significant subsidies and incentives that make European exportation particularly appealing. A formal EU investigation is underway, considering punitive tariffs against American E85– unless the U.S. government removes biofuel incentives. Good luck with that.

Researchers at The Institute of Traffic Engineering and Logistics in Kassel, Germany, don’t like induction loops (those things under the pavement that detect how long a car has been waiting for traffic lights to change). They say the loops are expensive, failure-prone and easily damaged. Simplistic, too: they only say how long a car has been waiting; they don’t tell you how many other cars are in line, how many are approaching and whether the other drivers plan to turn off or go straight ahead. The solution: mobile phones that automatically communicate with traffic lights. AKTIV (Adaptive and Kooperative Technologies for Intelligent Traffic, a project funded with federal millions) envisions mobile phones equipped with WLAN and GPS sensors, installed inside cars that tell nearbye traffic lights where you are heading. As a quid pro quo, the traffic lights tell your mobile how many seconds remain till the light turns green and whether you should turn your engine off. Traffic flows should improve, because AKTIV (pro-actively) times traffic light changes according to the amount of vehicles waiting. It should save fuel too, because stops are shorter and enables engine shut-down combined, with a “wake up call” to let drivers know green is on the way. A pilot project will begin in 2009. I asked AKTIV’s Walter Scholl if people fear Big Brother. “We consider data protection crucial. So all car data will be anonymized, and deleted as soon as you leave a junction.” But isn’t it so that the more gadgets people use, the less attentive they drive? “We have a working unit concentrating on ‘safety and attentiveness,’ and we need to attain empirical evidence that our system doesn’t distract from the task of driving.” Isn’t this technical overkill? Why not just replace traffic lights with traffic circles / roundabouts? “Good question… Roundabouts help, but there will always be many situations where lights are better and safer. In addition, our system will help reduce the amount of street signs as well as other distractions”. I’d like to hope so.