TTAC Used Car specialist Steven Lang swears eBay’s “completed items” section is the most accurate indication of any given vehicle’s “real” market value. I have no reason to doubt him. But trolling the auction site for the quirky whips or celebrity cast-offs– the brother of the drummer of the Cars’ modded Monte Carlo– is a practice I find tedious both in execution and end result. OK, Autoblog has a keen eye and more patience that I can muster. And I’ve promised TTAC’s Best and Brightest a better mix of automobiles and politics. So I put on my websuit and surfed a few of my favorite car porn sites on your behalf. My first NEFOTD is this little beauty. The duPont Registry provides provenance: “This car was judged Best in Show at the 2003 ACD National in 2003, and then went on to win at Pebble Beach in 2004. It was restored by La Vine in Florida at a cost of over several hundered [sic] thousand dollars. The car was far ahead of its time with front wheel drive, pre-selector 4 speed transmission, stunning styling and a supercharged 8 cylinder motor developing 175hp. The car had been stored for many years before being restored to its present condition. Only 688 Supercharged Cords were made in all models at a cost of over $3000.00, a 37 Chev sold for $415.00.” If you want a classic car, you can do no better than to buy someone else’s prize-winning restoration (for pennies on the dollar). Anyway, eat your heart out eBay.
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In The Incredibles, as Syndrome is about the vanquish Mr. I, the fan-gone-bad pauses to explain his actions. As he does so, our hero counter-attacks. “You caught me monologuing!” Syndrome chides himself. And it’s true: monologues place their creator in a particularly vulnerable spot. If he or she can’t sustain the listener’s interest, there’s no one– absolutely no one— else to blame. And like the shock and awe-meisters who attacked Iraq, brother, I know what it’s like to bomb. Still, in cyberspace no one sells ice cream. Ba-doom-boom. But seriously folks, I’ll get that damn headset Monday, and resume podcasting with one of our regular cast of characters. And I’ll start phoning newsmakers to get the inside dope on the dopey things going down in Motown, and elsewhere. Meanwhile, an experiment, if you will. If you won’t, I hear you. Er, feel you. Um… understand.
The recent historic drop in fuel consumption has translated into a $3b drop in taxes going into the Highway Trust Fund year-on-year. It’s a crisis! It’s a good thing that GW Bush signed into law the “Safe, Accountable, Flexible, Efficient Transportation Equity Act” back in August ’05. The Act empaneled the National Surface Transportation Infrastructure Financing Commission (NSTIFCT), and directed it to devise a new way to finance the Highway Trust Fund. Reuters has secured a draft copy of the commission’s final report. NSTIFCT’s recommending that Congress should raise U.S. gasoline taxes by 10 cents a gallon later this month, to “fix bridges and ease congested highways.” But that’s not all! “The gas tax is broken, so any increase in gas tax is just a Band-Aid,” commission member Adrian Moore said. “It gets you through a very short term. It doesn’t even remotely solve the problem.” Actually, the only thing broken about the federal gas tax is that it’s fixed at 18 cents per gallon. The tax hasn’t been adjusted for inflation– or any other factors– since it was last increased in 1993. But Mr. Moore doesn’t point out obvious fixes like indexing the federal gas tax to inflation, or otherwise periodically adjusting the tax based on the needs for highway spending. Anyway, Mr. Moore is down with pay-as-you go, we-know-where-you-are road pricing. Privacy concerns? No worry, Big Brother will not be a government agency, but a consortium of private road builders looking for a profit. Sort of like health insurance companies, only more intrusive. So which would you rather have, private toll roads and FasTrack monitoring everywhere, or gas taxes adjusted as needed to keep our highways in an adequate state of repair? Here’s hoping we get to make that choice.
On Monday, the German magazine Der Spiegel will report that Daimler had looked at taking Volvo off Ford’s hands. But after trying Volvo on for size, the good folks in Stuttgart decided it’s not a good fit. “Daimler boss Dieter Spiegel has carried out a close examination of a possible purchase in the past few weeks and acknowledged a series of possible drawbacks,” the German weekly will say. According to Der Spiegel, Daimler scoffed at problems with harmonizing Volvo with its own Mercedes cars. The article is not even out yet, and it has already been shot down by a missive from Stuttgart. Two days before the report was to appear, Daimler said it’s a fabrication. “We were never interested in Volvo,” a Daimler spokesman said to Reuters. Not interested doesn’t mean they didn’t look.
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Maranello, we have a problem. Ferrari sales are down – way down – and waiting lists are evaporating. It’s not difficult to lay the blame for the sales meltdown on the “global credit crisis.” But the Scuderia must shoulder a good portion of the blame. Demand for the F430, particularly the Spider, has virtually disappeared following the arrival of the Ferrari California retractable hardtop. As it turns out, most F430 buyers didn’t care so much about the F430’s mid-engined balance, peerless on-track performance or Schumacher-tested suspension. They were buying the F430 because it was the cheapest Ferrari. And now that there is a cheaper one, they’re buying that instead. What we have here, as Strother Martin might say, is failure to understand the customer.
The New York Times entered the irony-free zone this morning, with an op ed entitled “GM’s Secret Success.” WTF? Is one of the Gray Lady’s ambassadors about to call GM’s descent into bankruptcy and subsequent raid on the public purse a “success”? Nah. The author of the forthcoming tome “Why G.M. Matters: Inside the Race to Transform an American Icon” wants you to know that GM CEO Rick Wagoner is a genius interruptus. “In reality, Mr. Wagoner has presided over the most sweeping transformation of G.M. since the 1920s,” William J. Holstein opines. “He has reversed management’s long practice of meekly going along with the demands of the United Auto Workers, notably with a deal to transfer health care costs to a union-controlled trust over the next two years.” Ah, a tour of an alternate reality. Cool. But why stop there? Why indeed.
There’s nothing like matching wits with the sweepers in a car that normally fears a bend in the road. Unless you own the well engineered underpinnings of a Porsche, Corvette, BMW or a handful of less obvious winners sporting a bona fide performance suspension from the factory, that is. For the rest of us, there are after market alternatives that allow loyalists to keep their current rides (and monthly payment) and let the inner Pistonhead shine in all its glory. With this in mind, start with better tires, and then take a look at your sway bars.
On Monday, U.S. manufacturers will announce – as much as they hate it – last month’s sales. It is expected that sales have dropped in December by “48 percent from a year earlier at Chrysler, 41 percent at GM and 33 percent at Ford,” based on the average estimates of analysts surveyed by Bloomberg. The oracles expect a likewise bloodbath amongst the Nipponese: “Toyota Motor Corp. may report a 40 percent slide and Honda Motor Co. may say its total was down 36 percent,” said Brian Johnson, a Barclays Capital analyst in New York.
The actual numbers reported by the manufacturers will provide fodder for the dreaded SAAR, which will also be announced for December. No, it’s not a disease that will wipe out China, although it might cause similar symptoms. It’s the Seasonally Adjusted Annual Rate for the month. It’s a statistician’s shorthand for “how many cars would we sell for the next year if people’s buying habits stay exactly like the last month?” For all we know now, the December rate will probably be the worst in insert-the-appropriate-timescale-here.
It’s one thing to pay lip service to a brand. It’s another to be it’s slave. I’ve got no problem wearing that yoke. As Bob Dylan opined during his Jews for Jesus phase, you gotta serve somebody. So when I put the idea of a GM and Chrysler boycott to TTAC’s Best and Brightest, I was ready, willing and able to receive blowback. I may have invented this brand, but you, dear readers, own it. As the “are you out of your fucking mind” comments piled up (preserved for posterity), I was overwhelmed by your passion, logic and common sense. Clearly, a GM/Chrysler boycott is/was/would be a big mistake: a brand extension that would weaken TTAC’s core remit. And we can’t have that. So I have abandoned the idea. I apologize for going off the deep end, and thank you for resetting my moral and marketing compass. And yes, there will be more car stuff. In fact, I’m going to test a brace of Lexus SUVs later today, Or maybe the IS-F, just to remind myself that a good brand takes joy in what it does best, and leaves the rest of the market to itself.
We all know that November was a bad month for car sales. Come Monday, we’ll know how bad December was, and with it the whole year. Don’t expect any positive surprises. Pop quiz: What was the worst segment? The much maligned SUVs? Nope, they are back in vogue, kindof. It’s hybrids that suddenly are on the endangered species list. “Americans’ appetite for hybrid cars is evaporating as tumbling fuel prices and tighter household budgets trump environmental concerns,” writes the Financial Times (sub.)
Yes, bound for extinction are the same cars that were the conveyance of choice for Detroit’s CEO’s during the second round of hearings. One of the hottest segments a few months ago is now a thin slice of its former glory. We’re talking the same hybrids that sucked up billions of investments, and were the target of $25b of Department of Energy “retooling loans.” With gas back to normal, hybrids are going out of style bigtime.
A – due to worldwide holiday inertia – very short overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off. Until Jan 4, 2009, WAS is being filed from Tokyo
Suzuki down in India: Maruti Suzuki is India’s top carmaker. They own half of India’s car market. Like everybody in India, they got it on the chin. Their total vehicle sales in December fell 10 percent from a year ago. At least, their domestic sales rose from the previous month, after declining in November and October. Total December sales of Maruti Suzuki fell to 56,293 vehicles from 62,515 in the same month a year earlier, the Nikkei (sub) writes.
Tata WAY down in India: India’s Tata sold 23,894 units domestically in December, a decline of 44 percent compared to the corresponding month last year, India’s Economic Times reports. Including exports, Tata’s total sales for December 2008 stood at 25,219 vehicles, down by 47 percent. For the year 2008, their sales fell 11 percent.
Toyota nixes plans for Russia, Thailand: Toyota will freeze construction plans for new factories in Russia and Thailand, Bloomberg writes.
Ford sees further downside: Ford expects industry-wide December U.S. auto sales to drop by some 35 percent from a year earlier with no sign of a turnaround in the first quarter of this year, Reuters writes. Ford’s chief sales analyst George Pipas expects that full-year sales of light vehicles in the U.S.A. will drop to 13.2 million for 2008, down from 16.2 million in 2007. “The sales rates have declined like a lead balloon, really,” Pipas said. “I think when December comes in, every segment will be down. Not one segment will be up versus a year ago.” And there is no quick end in sight: “We’re not looking for the first quarter to be much different from what we saw in the fourth quarter,” Pipas said.
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The Wall Street Journal gets its fair share of flak from TTAC. Now it’s time for a pat on the head. Under a downright TTAC-ish headline (“Treasury to Ford: Drop Dead”,) the WSJ lambasts the Treasury for being a bunch of unappreciative sumsabitches: “When the Bush Treasury decided to bail out Detroit, GM and Chrysler quickly said yes to the taxpayer cash, but Ford Motor Co. said it didn’t need the money and declined. Ford’s reward for this show of self-reliance? Treasury is now helping GM again by giving it a credit pricing advantage against Ford in the marketplace.”
Farago wrote: “If I were the head of Ford or Toyota or Honda’s lending unit, I would be mighty pissed.” The Wall Street Journal agrees. Now that the U.S. Government effectively owns GMAC, it gives them the money to offer zero percent financing – for GM products. Says the WSJ: “The messy little policy issue is that these GM products compete with those sold by Ford, Toyota, Honda and numerous other car makers that won’t benefit from GMAC’s cash infusion. And with the cost of financing often crucial to buyer decisions, the feds have now put the muscle of the state behind one company’s products.”
The federal government buys GMAC and the MSM says huzzah! The credit taps are slowly starting to reopen! Meanwhile, on the front lines, the same scum-bags who helped cause this economic crisis by pushing people into cars (and houses) they couldn’t afford are busy reinventing the same wheel that came off before. In other words, predatory lending is back (did it ever leave?). And it’s bad! The Orange County Register lifts up the rock to reveals the slugs underneath (now with federal backing). In Q & A format, no less.
I’m sorry. I know. I should move on. I’d like to move on. But the more I read about the federal government’s $6b “investment” in troubled auto and mortgage lender GMAC, the more deranged the deal becomes. Fans of this series (?) will know that Uncle Sugar now effectively owns GMAC. If I were the head of Ford or Toyota or Honda’s lending unit, I would be mighty pissed. As a journalist, I find the cloak of secrecy surrounding the arrangement, from the timing of the Fed’s pre-approval for GMAC to morph into a bank, to the fine print of how this is all supposed to work. A regulatory filing unearthed by Forbes reveals that GMAC has “amended,” but not canceled, its exclusivity agreement with GM. “Purportedly, GM may now offer incentives such as low-interest loans through other financial outfits with increasing flexibility over the next 24 months. While the filing seemed to imply that private competition may be entering the government-backed lender’s universe, both the auto manufactorer and its banker seemed to indicate that nothing material had changed and the two had only altered their pact to satisfy the Federal Reserve’s demands.” Oh, that’s alright then. Or is it?
Yes, I’m a cynical bastard. I didn’t get where I am today– happily marooned on an island of incredulity– by taking what I’m told at face value. Now I know for a fact that there are shenanigans aplenty within the rarified world of high end automobile restoration, collecting and competing. Counterfeits, insurance scams, forgeries, kited checks, lies, deceit, deception, conspiracies by so-called experts– it’s like the fine art world only someone gets a prize at the end. So when I read of a “barn find” of 1937 Bugatti Type 57S Atalante, allegedly garaged by a surgeon since 1960, my BS detector went off. Now I’m not saying it is anything other than what the Reuters and The Daily Mail says it is: a rare and wonderful car owned by eccentric aviator/doctor stored in a Newcastle “lock up.” But the whole story seems somehow… pat. And there’s this: “The car was originally owned by the first president of the British Racing Drivers’ Club Earl Howe. ‘I have known of this Bugatti for a number of years and, like a select group of others, hadn’t dared divulge its whereabouts to anyone,’ James Knight, head of Bonhams’ motoring department, said in a statement. ‘It is absolutely one of the last great barn discoveries.'” So how can it be a “discovery” (a.k.a. barn find) if Knight already knew where it was? And square that with this: “Media reports said it could fetch up to six million pounds ($8.7 million) when it is auctioned at Bonhams‘ [emphasis added] Retromobile sale in Paris on February 7, which would make it the most expensive car to go under the hammer.”
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