If you’re familiar with Delphi—a former GM division with the words “bankrupt since October 10, 2005” over the door—then you’ll know that they’re a not-so-hidden cancer on GM cancerous corpse. Even as The General seeks to survive with a federal IV stuck in its metaphorical artery, it continues to peel off just enough cash—now your cash—to keep the parts maker making parts. For vehicles no one’s buying; but that’s how the industry doesn’t roll these days. So, some bad news from the oracle then. First, GM’s told their pals at the SEC (accounting scandal forgotten) that they’re accelerating a $50m payment to Delphi. [NB: Delphi had asked GM for a $100m hurry-up.] Can you say running on fumes? Delphi can. “The Company believes the amendment and accelerated GM support will enable it to preserve available liquidity given the difficult economic environment, particularly in the global automotive industry,” Delphi said in a filing with their pals over at the federal bankruptcy court. Judge Robert Drain, no less. And the cutbacks keep on happening!
Saw this ad on TV for the first time whilst fantasizing about a Rachel Maddow vs. Bill O’Reilly death match (rules upon request). The first thing that struck me: the Aptera is the only car in the world with less sideways visibility than the 1938 Bugatti Type 57SC Atlantic Coupe. Second, what is that hulk those guys are washing, and does the man from Griot’s Garage wince every time he sees that paint-scratching action? And lastly, I reckon the Volt has had its day in the sun. It’s not a profound Insight, but by the time Chevy’s not-so-slammed electric/gas hybrid appears, the Volt’s gee whiz factor will have drained off into the gestaltosphere. The Volt will have to compete with real cars in the real world, offering real advantages to real buyers. As you may have noticed, GM isn’t so good at reality. Still, where there’s a will, there’s an Uncle Sugar. The feds are lining up some $10k worth of tax credits for GM’s Hail Mary. Per vehicle. Is it enough? And will the clock run out before The General can even send in the special teams? Your guess is better than theirs.
Toyota will end their fiscal year ending in March badly bruised. Financial Times reports that ToMoCo’s losses will be three times larger than previously forecast. The worst industry slump in decades has put a painful crimp in an amazing run. Last year, Toyota earned a record operating profit of $30b. In the same year, they became officially the world’s largest automaker, a title many had said should have been given to Toyota a year before. In November 2008, Toyota still projected a profit of $6.6b. Then, carmageddon caught up with them.
An 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. WAS is being filed from Tokyo this week.
Geely doesn’t want Volvo: China’s largest privately owned carmaker Geely has denied reports that it is acquiring the Volvo car unit from Ford Motor Co, China Daily reports. Ford has also approached Chery Automobile Co and Chongqing Changan Automobile Co. Li Chunbo, an analyst with CITIC Securities Co in Beijing, said when a Chinese enterprise attempts to acquire a foreign rival it has to consider how it will benefit from the deal and whether it is capable of dealing with the purchased unit. “When you compare the market value of Geely and Volvo, you will ask how can Geely raise enough money to buy the European car brand,” he said. If this goes on much longer, not much money may be needed.
La bella clunker culleria: Italy is hopping on the European clunker culling bandwagon. Italian consumers will be given six months to go out and buy a new car under a “strong package” of incentives that Silvio Berlusconi’s centre-right government expects to approve today, Financial Times reports. The package would provide possibly up to €1,500 a car, to exchange models at least 10 years old for new, relatively small cars. The government would also provide credit guarantees to banks to finance purchases. The incentives are not limited to Italian cars, but the conditions attached—small capacity and least polluting—“would clearly favor Fiat,” the FT says. Protectionism, with style . . . . (Read More…)
Bloomberg reports that the U.S. government has retained white-shoe NYC law firm Cadwalader, Wickersham & Taft to advise the taxpayers’ reps on GM’s restructuring and possible debtor-in-possession financing. The Dickensian-sounding law firm joins Chicago’s Sonnenschein, Nath & Rosenthal (with newly acquired structure finance experts Thacher, Proffitt & Wood) and investment bankers Rothschild (which advised Delphi and gives Buickman conspiracy conniptions) in taxpayer-financed retainer heaven. The troika’s job: get Uncle Sam’s arms around the mess President Bush created by lending money to these failing, futile companies. And here’s the [overused metaphor alert] kicker: the U.S. government failed to get an inter-creditor agreement with the existing lenders done prior to the funding. So, when it all blows up, taxpayers’ claims on Chrysler and GM’s collateral are open to “debate.”
So it’s the dealers’ fault if Chrysler goes down in flames. Nothing to do with Daimler, who gutted the company like a fish. Or Cerberus, who wanted to gut the company like a fish, but found itself without a fish to gut. Or the company’s current management, who have lied, stonewalled, mislead, cut backroom deals with our elected representatives and generally manipulated honest, taxpaying Americans into supporting their stupid selfish schemes. As Chrysler’s backers, as their only means of survival, let’s think about this. ChryCo dealers aresitting on a 151-day supply of new vehicles (provided new car sales have stabilized). Even if Chrysler dealers didn’t order another car, truck or minivan, they’d have five months’ supply. There’s only one reason for them to take any more vehicles: to help justify the company’s desire to milk/bilk/fleece/con Uncle Sam for more “loans.” And still Cerberus point blank refuses to reveal to us, their supposed paymasters, whoowns the company. No matter what you think of a ChryCo Chapter 7 or 11 or car dealers, this is an unseemly, disgusting clusterfuck. Look what they done to my Chrysler, ma.
Classic & Sports Car magazine asked 20 car designers (full list after the jump) to name the most beautiful whip of all time. The winner: the Citroen DS. The Jaguar XK120 takes second place, followed by the Ferrari 275GTB, Cord 810/812, Ferrari 250GT Lusso, Ferrari 250GT Short-wheelbase, Jaguar E-type, Lamborghini Miura, Lotus Elan and Lotus Elite (1957). Caution: the DS’ position at the top of the pile (that doesn’t sound right) makes it the vehicle that most jurors voted most highly—rather than the car that most of them thought was the most beautiful. (Polls are funny that way. And our headline’s entirely misleading, now that I think about it.) Unfortunately, the buff book’s press release doesn’t reveal who voted for what. But the idea that a DS can hold a candle to American automobiles of the Classic Era (e.g. 1931 Duesenberg Model SJ “French Speedster” or 1935 Auburn 851 Speedster) is ludicrous, in a Le Corbusier is my God kinda way.
The vocabulary used to classify hybrid drivetrains has been lagging considerably behind new developments, as Wikipedia’s article on the matter proves. The old parallel, serial, mild and plug-in hybrid categories do little to illuminate public understanding of the underlying technology, and much to confuse it. Enter the BYD Dual-Mode, VW “Twindrive” and, now, the AVL “Turbohybrid”. With cooperation from BMW, Bosch and LuK, AVL has developed a mild-ish hybrid drivetrain. The consortium claims it’s cheaper and more fun to drive than a “full hybrid” while offering nearly the same efficiency. Care to deep dive?
Or is that Fortefied? Anyway, the forthcoming Spectra/Forte/XK (neéKoup) has been caught with only a little camo by the guys at Kia-World. And by the looks of things, it will be a Koupe-tacular little partner to the US-bound Soul hatch.
According to a study by the Consumer Federation of America (PDF), relatively low gas prices haven’t done much to change consumer trends towards more fuel-efficient vehicles. This revelation comes amid claims that small car demand was artificially inflated by high gas prices and increased truck production from General Motors. The survey asked respondents to rate the importance of gas prices, global warming and US dependence on Middle East oil over the next five years, with 76 percent reporting “great concern” for gas prices and energy independence.
An increasing number of media reports are indicating that instead of a single “car czar,” Obama will appoint a team to oversee the auto industry turnaround effort. Current reports indicate that Democrat fundraiser Steve Rattner will likely take the top oversight position, but his total lack of (non-political) qualifications for the job is considered an issue. Which is where Stephen Girsky comes in. “They clearly need an adviser who knows the industry,” former Chrysler president Thomas Stallkamp tells Bloomberg. “Girsky certainly knows the industry, and he was close to both GM and the union.” And though I have questioned whether Girsky’s UAW affiliations are best described in the past or present tense, this 2004 presentation (PDF) to Original Equipment Suppliers Association is decidedly prescient. Especially for 2004. And this December 2008 presentation to UAW Local 14 seems to indicate that his recent advising stint with the UAW was a mission of truth and reconciliation rather than one of conniving and obfuscation.
The Detroit News reports that GM’s Political Action Committee has temporarily halted political donations. And you might be tempted to think that this is a move of propriety, so as to not run afoul of Obama’s standards on lobbying by TARP recipients. But you’d be wrong. “As we have done in previous years following an active election cycle, we are holding off on making contributions in the first quarter as we replenish employee contributions,” says GM’s Greg Martin. But this isn’t a normally scheduled stop for GM’s busy DC operatives. According to the DetN, it’s the first such halt in six years, but “GM, like the other automakers, has cut its salaried ranks by thousands of workers, losing many donors to its political action committee.” And let’s not forget that those who are still there are being paid by federal bailout money. A look at GM PAC’s 2008 contributions and expenditures helps explain why a bailout happened at all (they gave money to everybody), but a few interesting questions also arise. Like why did Bob “Crock of Shit” Lutz donate over ten times as much as CEO Rick Wagoner and other executives? And how are so many of those Detroit-hatin’ southern Republicans on the payroll? Probably because the old standbys no longer have the clout they once did. Besides, now that the public is invested in GM, the chances that congress will cut GM loose to go bankrupt are slim.
A commentator recently accused TTAC of posting a CarMax superbowl ad just because the company owns a panel on our home page. Uh, no. Short of not accepting any advertising and switching to a pay-per-view model—which our Best and Brightest rejected like a high school quarterback talking to an ugly misfit frump in a low-budget horror movie—we’ll take what ad support we can get. But we give our advertisers no quarter. I’ve seen plenty of GM, Toyota, Ford and Chrysler ads on TTAC, and you know how we roll in that regard. Some of you may also recall negative comments from buyers who felt they were boned to the max by CarMax. Personally, I really like Chris Wilmore and his crew. I also like every PR person I’ve ever met (on the personal level). Ça fait rien. No one has ever successfully messed with TTAC’s editorial independence. Nor will they. It’s our USP. It’s what we do. K? Now, CarMax ran an interesting survey asking the question above. Their results after the jump. My take: not asking TVR how long their half-sized underfloor battery could hold a charge. Yours?
Same as it ever was. Green Car Congress covers a DOE report (pdf) to the U.S. Congress on its $1.2b Hydrogen fuel cell development caucus, and the conclusion is clear: keep waiting. The DOE had harbored a shockingly naive hope that OEMs would be able to field 100k fuel cell vehicles by 2010, but the new report seems pretty clear on the chances of that happening. According to the report, “a 2008 independent study estimated that the high-volume manufacturing cost of automotive fuel cell systems (using current technology and assuming 500,000 units per year) would be $73/kW, which equates to almost $6000 for an 80-kW system. This current technology would be more than twice as expensive as internal combustion engine systems. And, based on the highest demonstrated durability to date, fuel cell systems would have a lifespan of approximately 1900 hours, which equates to about 57,000 miles and is still substantially lower than today’s estimated vehicular lifespan of 150,000 miles.”Sound familiar?
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