Did you think that finally sacking Mark LaNeve might have been another step in the direction towards the “culture change” promised land? Time for some new meds. And while we usually have to sit on our sour-puss predictions for a few days before being proven right, GM decided to back us up early this time. Automotive News [sub] reports that none other than Buick-GMC boss Susan Docherty will be replacing LaNeve at the pinnacle of the GM sales operation. “She brings a fresh perspective to the job and she has an extraordinarily high level of energy,” says Fritz Henderson. By which he means she’s a lifer, and owes her career to the timid, inept culture Henderson is simultaneously a product of and ostensibly bent on breaking.
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Posts By: Edward Niedermeyer
GM’s PR efforts have a kind of spastic, bipolar quality to them. Months of near-silence are punctuated by spasms of oversharing and an avalanche of hype, none of which typically addresses the underlying concerns which prompted the orchestrated campaign. Bouncing off of today’s 90-day report card today, Chevrolet’s Brent Dewar hosted a Fastlane livechat in which we were given yet another chance to learn more than we ever wanted about the people running Chevrolet. And next to nothing about the future of the bowtie brand.
It’s a sad day for the dealer body. I felt GM had its best chance with him. He was a great leader and inspirational. Hopefully the rest of management will stay intact.
A Buick dealer gives the only known positive post-mortem for the latest victim of GM’s cultural revolution [via Automotive News [sub]]. A more fitting eulogy might be found here.
Stefan Jacoby has been the top dog at VW of America for over two years now, but he still has the fresh curiosity of a freshly arrived tourist. Sitting down with “Max” and the Washington Post to hump VWOA’s mass-market dreams, he offers a few thoughtful insights.
“Here, there is more cruising and long-distance driving. In Europe, there are more tiny roads and you drive more actively than in the United States,” explains the highly-paid executive. “We Germans drive and we are not drinking in the car. Americans have breakfast and coffee in the car. We have to adjust to this.” Mein Gott! With insights like this, Jacoby should have no problem breaking a million annual sales by 2018. All these things take is “a more user-friendly steering wheel and entertainment system, an accelerator and brake pedal that are farther apart, and larger cup holders.” Oh yeah, and not evaporating your brand in the process. Or, as VW exec Werner Schmidt once described the Americanization of the Mk1 Rabbit, “Malibuing” away the Euro-appeal that is the Volkswagen brand in this country.
“I certainly don’t want to leave you with the feeling that, y’know, things are humming,” quips Frtiz. “Because they’re not.” Then what, pray, was the point of today’s “progress report” snowjob? But Fritz is just kidding, things really are ginger-peachy keen. As recent trips to the Harvard and Michigan business schools taught him…
90 days out of bankruptcy, GM is taking a moment to explain just how well the turnaround thing is going. Or, to use the PR-present tense, how GM “Accelerates its Focus on Customers, Cars and Culture.” CEO Fritz Henderson explains in the report press release (PDF):
Over the past ninety days since we created the new GM, we’ve already launched a number of new, fuel-efficient, highly successful cars and crossovers; introduced a new marketing campaign that highlights our best-in-class fuel economy, quality, warranty and safety performance; sworn in a new Board of Directors; and overhauled our management. We are taking aggressive actions and moving quickly to transform our culture into one that is truly customer focused
Everything you need to know about this exercise in corporate affirmations (I’m good enough, I’m smart enough, and doggone it, people like me!) can be found in the slide (above) titled “Concerns” from the report’s accompanying presentation (PDF). Nothing about the crisis surrounding Daewoo. Nothing about a steady erosion in sales that no marketing effort has been able to turn around. Nothing about binge-and-purge inventory “management.” Nothing about the near-impossibility of showing a profit by the planned IPO. In short, GM glossed over its issues like a 12 year old with her first stick of Lip Smackers. (Read More…)
Fritz Henderson just confirmed in a conference call that GM’s VP for US Sales Mark LaNeve will be leaving the company by October 15. An email by Henderson obtained by the Detroit News, makes it clear just how long LaNeve outstayed his welcome. There’s damning with faint praise and then there’s this:
Mark has contributed significantly to GM in several key positions, including transforming the Cadillac brand and leading the vehicle sales, service and marketing organization during one of the most challenging periods in GM’s history. Please join me in thanking Mark for his dedication and wishing him and his family well. A replacement for Mark will be named at a later date
Greentech Automotive is the hybrid vehicle firm founded by the former CEO of Brilliance with plans to build a plant in Mississippi with funds raised through the EB-5 visa program. Not to be comfused with Hybrid Kinetic Motors, the hybrid vehicle firm founded by the former Chairman of Brilliance with plans to build a plant in Alabama with funds raised through the EB-5 visa program. Now that we have that clarified, we can declare Greentech the frontrunner of these two competing enigmas, for at least showing a few hecho-en-China prototypes. The DeSoto Times describes the prototype models as a hybrid coupe that can deliver 45 miles per gallon and go from zero to 60 mph in 5.9 seconds, a four-door, mid-size hybrid which should deliver 50 mpg, a zero-emission electric sub-compact capable of traveling 80 miles on a three-hour charge and a high-efficiency gasoline sub-compact capable of 65 mpg. Initial factory plans call for a $1b phase-one investment, which will get the plant to 150k annual capacity and employ 1,500 workers. Eventually, Greentech hopes to employ 4,500 workers building 250k units per year, and –get this– capture one third of the US market.
The new Delorean Motor Company is apparently exploring the possibility of buying GM’s Wilmington Kappa plant and building a Pontiac Solstice GXP-based sportscar there. The firm released the rendering above, and the following post via Facebook:
What if John DeLorean were still alive? Some of his greatest automotive accomplishments were at Pontiac, and now the Solstice is a new car without a brand, and DeLorean is brand without a new car…
After four years in Chapter 11 protection, GM’s largest supplier Delphi is returning to the land of the living. For now. Along the way, though, Delphi racked up some impressive bills. Automotive News [sub] estimates that GM has spent $12.5b on Delphi during its bankruptcy, and has pledged a further $1b in debt assumption, $2b in forgiven claims and $1.75b in investments in the new company. For these (taxpayer funded) sacrifices, GM will get Delphi’s money-losing US operations and steering unit business. Delphi’s new owners Elliott Management and Silver Point Capital walked away from $3.5b in debt to assume control of the company, and $6.25b in pension obligations were dumped by Delphi and had to be assumed by the Pension Benefit Guarantee Corporation. Delphi’s bankruptcy alone cost $400 million in legal and professional fees. The new company’s manufacturing base has been migrated outside the US, and its main business will be in supplying electronics and air conditioning systems. Expected annual revenue is $10 billion compared to the $22.59 billion the firm earned in 2005, before entering bankruptcy. But rather than tut-tutting the waste, greed and ineptitude that has marked Delphi’s bankruptcy, let’s take this moment to remember the thousands of employees and retirees Delphi has cast aside in the name of rescuing the US auto industry. For, as the Sibyl of Delphi foretold in the 9th Century B.C.E., love of money and nothing else will ruin Sparta.
Honda is showing a new, near-production version of its forthcoming CR-Z hybrid sports coupe at the Tokyo Auto Show. According to this video, Honda is calling its design language “Advanced Sensual Bullet.” You feeling it? If not, research is already underway on modifications to make the neo-CRX look more like the ur-CRX. And styling aside, the contrast between the CR-Z (1.5-liter I-4 with IMA mild hybrid, FWD and a six-speed manual) and the Toyobaru FT-86 (2.0 boxer four, RWD and a six-speed manual) should make for some interesting road tests and endless internet debates. In 2011. Or perhaps even 2012. Still, these are encouraging signs for those of us who might have been tempted to declare the age of the entry-enthusiast car at an end.
Bloomberg reports that the US International Trade Commission has launched a probe of alleged patent violations which could result in the banning of all Toyota hybrids from the US market. Paice LLC won a 2005 civil suit against Toyota, in which Paice’s founder Alex Severinsky sought a court order banning the sale of Toyota’s Prius, Highlander and Lexus RX400h hybrids. Instead, an appeals judge awarded Paice $4.3m in damages, and ordered Toyota pay Paice a $100 royalty per hybrid sold in the US. In the current case before the ITC, Paice claims that Toyota’s Camry, third-generation Prius, Lexus HS250h sedan and Lexus RX450h are “are materially the same” and violate the same patents as those in its first case. If Paice can convince the ITC that Toyota indeed violated its patents, he will still need to prove that the little-known company has a market to protect. But Paice doesn’t actually want Toyota to be banned from selling cars. In the words of one patent attorney, an “injunction would have given Paice strong leverage to negotiate a lucrative licensing deal with Toyota…Paice always felt that their technology was worth a lot more than [$100 per car] to Toyota.” (Read More…)
Audi’s US market product plans have been spilled to Automotive News [sub], and there are a few surprises in the mix. The e-tron all-electric R8 has reportedly been given a green light for production within two to three years. Staying with Audi’s EV plans, there’s word that the Europe-only A2 could be brought back as an EV for the US market. Though the all-aluminum A2 ceased production in 2005, the AN report is unclear whether a possible A2 EV for the US would be based on a new version of this blogger’s favorite city car. An A3 sedan has reportedly been approved for the US as well, although rumors that the forthcoming A1 could be coming stateside as well have been squashed over currency concerns. A restyled A8 is planned for 2010, and an A6 refresh is scheduled for 2011. Meanwhile, the A7 (shown as the Sportback concept) will go into production in Europe, although it doesn’t seem likely to arrive in the US. A Q3 crossover is planned for 2011, but not until a hybrid version of the Q5 debuts. Audi has dropped FWD TT models from its lineup, and is considering selling an A4 with the Q7’s 3.0 twin-turbo diesel V6.
The Federal Trade Commission has announced revised rules guiding advertisement, endorsements and disclosure for bloggers. These new rules will particularly affect car bloggers, due to the heavy influence that advertising relationships exert in editorial decisions by auto journalists. And the seemingly undying trend in mainstream auto “journalism” towards pimpatorials. Needless to say, they also validate TTAC’s long-standing disclosure policy. From the FTC’s release:
The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization.
One last General Motors-Condé Nast parallel worth pursing: Both companies have been badly run by executives who invested more effort in pursuing perks, status, and empire-building than chasing profits. Writing in a slightly different context, Condé Nast veteran Tina Brown summed up what ails the magazine company in an April post on the Daily Beast: “The court of the Sun King is a rats’ nest of competing favorites who jostle for the 81-year-old supremo’s [S.I. Newhouse] attention.”
Jack Shafer connects the dots between the failures of Condé Nast and General Motors over at Slate.
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