Delphi and Visteon were spun off from GM and Ford respectively at the turn of the millennium, in hopes of cutting costs and improving efficiency. But rather than creating healthy, solid companies they could rely on as major suppliers, the Detroit OEMs used the spin-offs to dump unwanted assets, UAW workers and fixed-cost obligations on their new partners. And now GM and Ford are reaping the bitter harvest of their ill-advised spin-offs. Visteon, which has never turned a profit, just had its stock delisted last week after losing $663M in 2008. Delphi has been in Bankruptcy since October 2005, and, having lost $1.48B last year, it is barely surviving on cash infusions from the General, which really could have used the dough. And both suppliers are threatening to take down America’s two largest automakers.

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Susanne Klatten, Germany’s wealthiest woman, and a member of the Quandt family—the leading shareholders in carmaker BMW—bid good-bye to a former lover. Helg Sgarbi was jailed for six years on Monday for trying to blackmail (with secret video of their lovemaking) the heiress to the BMW car empire, Reuters reports.

Helg Sgarbi admitted that he had seduced heiress Susanne Klatten and three other wealthy women, persuading them to pay him almost 10 million euros ($12.64 million). Klatten went public last year with the story of how her lover secretly shot intimate footage and later demanded tens of million of euros not to reveal it. Sgarbi’s admission spared Klatten, who is rarely seen in public, a court appearance.
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Automotive News [AN, sub] does an excellent job covering the industry. Most of the time, AN is an unbiased if largely toothless conduit of autoblogospherical fodder. In other words, they report, we decide. But today’s column by Editor David Sedgwick is, well, appalling. No really. I am shocked at the depths of disinformation, dissembling and, yes, dishonor to which AN and Sedgwick have sunk. “GMAC’s chief has a chance to earn his millions” begins by asking “Is Al de Molina worth $11.6 million?” The obvious answer has Will Smith written all over it: oh HELL no. Unless, of course, you’re one of the Cerberus insiders who benefitted from the Fed’s last minute rule change. You know, the one allowing GMAC to become a bank when it didn’t qualify for bank status. Oh and then there’s Uncle Sam’s $6b GMAC bailout. So yes, I guess Al de Molina is worth the big bucks to someone. Sedgwick’s column, on the other hand, isn’t worth the paper it’s printed on.

Automotive News [sub] reports that even as GM seeks to spin Opel off to anyone who has the cash to save it, it’s raiding its German subsidiary for competitive product. Specifically, Opel’s much-vaunted Insignia sedan is set to become the 2010 Buick Regal, rather than the 2010 Saturn Aura as previously planned according to anonymous sources. Which is not completely surprising considering that Saturn as we know it has shuffled off the mortal coil, and the Insignia is, by many reports, a great car. But it’s still a horrible idea. Buick has already debuted another 2010 Epsilon II-based model, the LaCrosse, making for some instant cannibal action. “We’re looking at a bunch of stuff from a sedan standpoint,” says BPG VP Susan Docherty. “We’re going to add some more sedans, so stay tuned.” Docherty declined to comment specifically on the Buick Insignia fandango, but tells AN that “as GM works to cut Pontiac’s product offerings, the company can offer new Buick vehicles to keep the Buick-Pontiac-GMC channel well-rounded.” Well-rounded? Seriously? Besides revealing that GM is light-years away from whipping its perennial cannibalism problems, this story also suggests that Opel will continue to share architecture and platforms with the corporate mothership. Whether they need them or not.

German newspaper Die Welt had reported on Saturday that GM and Opel seems to be preparing for insolvency at Opel, having hired three law firms with renowned insolvency experts. GM denies the report, writes Reuters. “This scenario is currently not on the agenda,” a GM Europe spokesman told Reuters on Sunday. Note the careful usage of “currently” and “agenda.”

Die Welt says GM Europe would be advised by Baker & McKenzie as well as Clifford Chance, while the management of Adam Opel GmbH had hired Heidelberg-based firm Wellensiek. GM doesn’t deny that they have hired counsel: A GM Europe spokesman said the company had hired the firms to assess the effect of potential restructuring measures. Meanwhile, there is growing outrage in Germany about the fact that Opel never paid tax in Germany because it transferred profits to its U.S. parent.
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The Original Bailout Terms:

Viability Requirement: The firms must use these funds to become financially viable. Taxpayers will not be asked to provide financing for firms that do not become viable. If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury.

Definition of Viability: A firm will only be deemed viable if it has a positive net present value, taking into account all current and future costs, and can fully repay the government loan.

Binding Terms and Conditions: The binding terms and conditions established by the Treasury will mirror those that were voted favorably by a majority of both Houses of Congress, including:

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No doubt inspired by the endless supply of videos around the web of Saudi drivers tearing ass across the streets of the Kingdom, the NY Times recently sent a man to investigate. He found that between drag races and the “drifitng” shown in the video above, the Saudi streets come to resemble a cross between Death Race and The Fast and The Furious. It seems that a great national boredom, or “tufush,” has seized the young men of Saudi, and with no public entertainment and few jobs, an underground car culture has flourished. Wealthier and middle-class men drag race Corvettes and Imprezas all night, but for the poorer, more desperately in need of excitement, only drifting cars through and around traffic will do. And the scene has created one crazy melting pot of young, angry desperation.

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Saudi+drift+WOW

In comparison to the Genesis sedan, the Genesis Coupe has appeared on dealer lots like a Stealth bomber sliding into Whiteman. Either Hyundai thinks their new two-door makes such a strong impression it doesn’t need a huge marketing campaign to jump-start the public imagination, or they blew their wad with the sedan. Whatever Hyundai’s intentions, the Genesis Coupe speaks for itself, surpassing its current competitors in the pony car market. (2010 Ford Mustang test to follow.) If you’re looking for a rear-wheel drive, high powered sporty car at recession friendly pricing, exodus forms on the right.

TTAC Commentator Heath writes:

A couple of months ago I got the SVT suspension for my Focus. Not want to blow the budget any more I left the 205/50/16s that the Focus came with and there is a unhealthy amount of sidewall flex with the 50 (Pirelli P6). The SVT had 215/45/17.

My question is when its time for new tires, should I go for 40 or the 45. I’d like to stay on the 16″ rims as don’t really want to get new 17″ rims as well.

Sajeev responds:

If you stay with 16″ rims and go for a lower profile tire, the change in circumference messes up the speedometer, gearing (lower profile means more gear and less economy) and increases the unsightly gap between the tire and the body. We did this for TTAC’s entry for the 24hours of LeMons, and the gearing advantage was totally worth it. On a street car? I doubt it.

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The Presidential Task Force on Automobiles (PTFOA) rolls (flies?) into Motown today for a pow-wow with the ow-ow brigade. But wait! There’s more! Photo op alert! The AP tersely reports that “members of the government’s auto task force will test drive a General Motors Corp. electric car and tour a Chrysler LLC pickup truck factory on their Detroit-area visit Monday.” Whoa! GM has an electric car? Ohhh. They mean the electric – gas hybrid Hail Mary known as the Chevrolet Volt. The Detroit News—which previously linked their Volt-driving headline to a story on GOP opposition to more bailout bucks that forgot to mention either cart or pony (oops!)—is [now] a bit more forthcoming.

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My experience running the 2005 One Lap of America in a Mercedes-Benz 190E 2.3-16/ had left me more than a little cynical about the event. The fantasy of running the “modern-day Cannonball” had been eclipsed by frustration with the quasi-time-trial, horsepower-obsessed reality that is OLOA in the modern era. Still, the competitive disease from which both I and my co-driver Brian suffered meant that we wanted to “win” the thing before we left Brock’s Big Parade for the greener pastures of real wheel-to-wheel racing. Enter former radiologist and current Mercedes-Benz tuner Satish Tummala, owner of Motorwerks in Detroit.

Injuryboard.com, a website dedicated to promoting safety, protecting lives and chasing ambulances (I made that last one up, ish) writes:

The funeral of Harold St. John, a retired airline employee and former auto mechanic who died from mesothelioma caused by asbestos exposure, was interrupted at a New Jersey cemetery last week when, in a new moral low for defense tactics, a Chrysler official arrived with subpoena for his body.

The subpoena, which prevented the burial from taking place, was issued so that more tests could be performed to determine the cause of death. Before he died, 67-year-old St. John had sued Chrysler, along with Honeywell, claiming that the automobile brake linings he used to install in his father’s auto shop in the 50s and 60s had caused his illness.

The trial was set to begin March 9. Unexpectedly, St. John died on February 28. Though he had undergone a painful biopsy to provide a lung tissue sample while still living, Chrysler insisted on taking the body from its burial site before it could be laid to rest.

ChryCo spokesman Mike Palesi’s statement after the jump.

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Students (student?) of Sunday TV magazine shows will know that the Republican Party is beginning to realize the political advantages of throwing Detroit to the lions—I mean, upholding their responsibilities as guardians of the public trust (and purse). “The best thing that could probably happen to General Motors, in my view, is they go into Chapter 11,” Senator John McCain said on Fox News Sunday. Which would help GM reboot (not that John would ever say anything so hip), reorganize (not that John knows what that would entail) and renegotiate its labor contracts (ah-ha!) and emerge “stronger, better, leaner.”

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