Say you’re a small electric car maker in bankruptcy restructuring. You have no current production, you’ve only ever built a couple thousand street-legal cars and you’re operating on $6M in interim financing. With credit markets in turmoil and the car biz taking a beating, what’s a game changer to do? Luckily for you, the various governments of the United States seem to have acquired the reputation of being run by the kind of people PT Barnum would have loved. And as Autoweek reports, this opportunity has even the tiniest mice in global auto game warming up their vocal cords, hoping to pull off an American taxpayer-assisted roar.
Automotive News [sub] reports that GM spin-off supplier Delphi has received approval from bankruptcy court to cut benefits to 15k non-union retirees. The ruling will save Delphi an estimated $70M per year, improving the chances Delphi will end its nearly 3.5-year sojourn in Chapter 11 restructuring. GM has been helping generously towards that end, having offered to buy Delphi’s steering component business for an undisclosed sum and funneled hundreds of millions to its crucial supplier. Or quasi-independent division. Or whatever Delphi really is to GM. The full text of the order in question is here (pdf). It’s long, so check out a few highlights after the jump.
As a web-savvy car enthusiast and budget autocrosser, I try to do a lot of reading before pulling the trigger on a big purchase. With a set of R-compounds now hitting the $800 mark, I want to make the most of my investment. The consensus seems to be that shaving tires can make them perform better and last longer, but I remain skeptical… The cynic in me suspects that shaving is just a way to reduce tire life and pad the shaver’s wallet to the tune of $10 a tire. Why couldn’t tire manufacturers just build tires “shaved” from the beginning, if there was a real advantage?
Martin Winterkorn, chief of Volkswagen, was asked by Automobilwoche [sub] who will be left standing when the big carmageddon—ooops—consolidation will finally be over. Here are his odds:
TTAC is the third most critical reviewers of automobiles, according to Motor Mouths, an ambitious project which seeks to aggregate and rate car reviews. With an average review score of 75.52, TTAC is the least forgiving non-print outlet that MM rates. Only Consumer Reports (70) and the Wall Street Journal (73.5) boast a more carmudgeonly average score of vehicles they review, with Automobile.com and the NY Times rounding out the top five. Of course, standardizing reviews is a tricky undertaking, making comparisons a bit of an apples-oranges exercise. Still, MM goes there, even comparing reviewers with owner feedback to create an index of “reviewer credibility.” Sadly, TTAC reviewers don’t rate in the top three “most credible,” but since MM has only been around to gather owner feedback since February, we’ll give it some time. Not that we’d necessarily expect to replace the LA Times’ Pulitzer Prize-winning Dan Neil at the top of that list.
The Detroit News reports that GM told the Presidential Task Force on Autos (or at least the two guys who went to Detroit on a Volt junket) that the zombie automaker won’t be needing the previously requested $2B federal “advance.” GM requested the money last month to get them to the end of this month—when they’ll need another $16.6B federal “loan.” Oh, and please note that the $16.6B—on top of the $13.4B previously loaned, not including a share of the $25B Department of Energy retooling loans, or the $1B loan to prop-up GMAC—STILL includes the $2B that GM says they don’t need. You know, now. For another couple of weeks. Did I mention GM’s $2.6B request for April? Funny how all these billions get confused in my mind. So, how come the deferral? Bad planning? No, good! “This development reflects the acceleration of GM’s company-wide cost reduction efforts as well as pro-active deferrals of spending previously anticipated in January and February,” the automaker said in a statement. So, they’re cutting they’re way to prosperity. As if.
A post at the former Tesla PR chief’s personal blog recounts the debate inside Tesla over where to manufacturer the firm’s WhiteStar sedan. Siry describes grappling with the tradeoffs between a reasonable price and skeptical public perceptions of Chinese cars. “The part causing the most conflict,” writes Siry, “was that it was clear in the world of consumer electronics and chip manufacturing that low cost manufacturing had been achieved while also maintaining the highest standards in quality. Why couldn’t this be the same case for automobiles?” After all, he argues, your iPhone is designed in California but built in China—and nobody confuses it with a purely Chinese product. Pointing to the Volt’s projected $40K price point for a Cruze-based compact/mid, Siry argues that cost is too important to phasing EVs into the market to be ignored. And that firms like his former employer will pay the price for not taking advantage of China’s opportunities.
God I hate car awards—except for ours, of course. Nine times out of ten, the fix is in. The tenth time, the methodology is Claritin clear anti-matter. Well, at least ForbesAutos isn’t making those stupid “10 Best Cars in Which To Perform a Bris” lists anymore. Anyway, here’s KBB’s most recent contribution to the genre, which names Cadillac as the Best Comfort Food—I mean, brand. And Toyota scoops the award for Least Exciting Brand That Everyone Buys Anyway Probably Because It IS So Boring (i.e., Best Value Brand). Full list after you contemplate the ability of the English language to obfuscate while pretending to offer specificity.
The 2009 Brand Image Awards, presented to the top brands in 10 categories, are based on consumer automotive perception data from Kelley Blue Book Market Research’s Brand Watch study. Brand Watch is an online brand perception tracking study tapping into 12,000+ in-market new-vehicle shoppers annually on Kelley Blue Book’s kbb.com. The highly comprehensive Brand Watch report provides a detailed look at in-market new-vehicle shoppers’ perceptions of brands, and important factors driving their purchase decisions while they are in the midst of the shopping process. The results of an entire year of Brand Watch research and consumer opinions determine the 2009 Kelley Blue Book Brand Image Award winners.
Apologists for business-as-usual in the car game often took to blaming unnaturally high gas prices for last year’s trends towards smaller car sales and fewer vehicle miles traveled. When gas prices go back down, went the argument, Americans will go right back to buying thirsty SUVs and Crossovers and driving more miles. Not true, it seems. The New York Times reports that vehicle miles traveled (VMT) has declined for 14 months in a row now, despite the fact that gas prices are now hovering at about half of their peak levels from last June. “When the decline in American driving was first identified in late 2007, fuel prices were beginning to increase. The prevailing wisdom at the time was that the drop was due to increased fuel prices,” says Doug Hecox of the Federal Highway Administration which monitors traffic on America’s roads. The FHA estimates that VMT has declined by 115 billion miles in the period between November 2007 and December 2008.
When the new MINI was born, someone in BMW’s marketing department decided to make it a caps lock affair. As I opined at thetruthaboutgrammar.com, MINI was a stupid, artsy, doomed, graphical mandate. Yes, it differentiated the Bimmer-derived MINI from the much-beloved BMC rust-bucket, Mini. But no one other than designer glasses-wearing car execs gave a damn, really. The MINI sold, and sold well, for reasons entirely unrelated to typography (one presumes). Und now we have the battery-operated MINI, which gives Munich’s marketing mavens a chance to redeem themselves. I mean, eMINI is an Apple-scented slam dunk, a move that would easily justify the original, bone-headed, all-caps affectation. But noooooo. BMW goes for MINI E. How long, pray tell. does one hold the “eee” sound at the end? Anyone remember The Man With Two Brains? Dr. Michael Hfuhruhurr. MINI E is like that. Only not so funny.
Obviously, I don’t have an statistical data on Ferrari crashes. Neither, I suspect, does the National Highway Traffic Safety Administration (NHTSA); they don’t tend to compile stats on marques that sell in the hundreds. But as someone who spends his days floating through the autoblogosphere, I’ve noticed a number of halved Ferraris. We have the famous Enzo crash on the PCH, and now this, a fatal accident involving the mixed martial artist/TapOut clothing designer artist known as “The Mask.” So I clicked on over to wreckedexotics.com to search for more anecdotal evidence. While there are a number of Ferraris with fire-vaporized back ends (that’s where the engine is), I didn’t find a trove of demi-Ferraris. To defend my access to all those Ferrari press junkets (as if), I’ll posit that ANY car would break in two if it happened to hit something immovable side-on at a high rate of speed. In fact, it could very well be a good thing, providing you’re ahead of the fissure, as the cleaving process dissipates lethal energy. The question is, is that true?
One of the signs that a new technology has matured is when whole industries are worried about getting wiped off the earth as a result of that new technology. If that happens, change has finally arrived.
Industries are getting worried about electric vehicles. The machine-tool sector is very troubled, writes the Nikkei [sub], and it is worried for two reasons: “Plummeting demand from recession-hit clients is threatening the industry’s very existence, as the increasing focus on electric vehicles by ailing carmakers could eventually eliminate the need to machine parts for engines.” And why would that be? (Read More…)
Channel Web says a quite simple adaptation of lithium-ion battery technology could make electric cars a hell of a lot more convenient. As reported in today’s issue of Nature Magazine, MIT researchers Byoungwoo Kang and Gerbrand Ceder have found that coating batteries with a thin layer of lithium phosphate allows small batteries to be loaded in twenty seconds, while car batteries could be good to go in just five minutes. That sure beats the six to eight hours plug-in vehicles currently need—provided you have access to an electricity outlet with a lot more than 110 or 220V. Anyway, MIT engineers have taken existing battery material and changed it to create what it calls a “beltway” that allows for the rapid transit of electrical energy.
You may recall the story wherein two swanky Lamborghini dealerships—Lamborghini of Orange County and Lamborghini of Calabasas—suddenly closed their doors. Needless to say, the collapse involved a little “creative accounting.” It can now be revealed [by the LA Times] that dealer principle, Viken Keuylian, 45, of Laguna Hills, borrowed $12M from Volkswagen Finance to personally purchase 54 examples of VW’s Italian supercars. Keuylian then spent the money, put the cars on his lot, sold them for $8,163,275 and spent that money too. Vineyard. Lotus dealership (talk about a sinkhole). Gas for HIS Lambo. The girls above. That sort of thing. Simple math reveals that the grifter liberated $20,723,589 from VW and Lambo customers. Obviously, Keuylian will soon be contemplating his crimes from a jail cell. But the big question: will VW go after his customers, demanding they pay the “real” price for their car or cars? It’s highly unlikely. But even so, VW Financial’s credibility and profitability have taken a major ding.
Things are either rapidly falling apart for Chrysler in China. Or someone is tidying up for the rumored asset transfer to Beijing Auto. Place your bets.
Anyway, China’s Great Wall Motor has terminated its small-car joint venture project with Chrysler, Gasgoo reports. Why? “Due to changed situations,” said Great Wall’s president Wang Fengying.
Chrysler had signed a memorandum of understanding with Great Wall Motor in July 2008 to explore the viability of a long-term strategic relationship. The two companies have since developed an A-class car model that was scheduled to be produced by Great Wall and sold around the world as a rebadged Chrysler. What now? (Read More…)
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