GM’s Daewoo division is on the verge of being taken over by its largest creditor, the Korea Development Bank, reports the Korea Times. KDB CEOO Min Euoo-sung warns GM:
If General Motors does not play the role of the largest shareholder of GM Daewoo in an appropriate manner, we will start to retrieve loans that will mature this month. General Motors should accept both the financial and non-financial requirements of the creditors. If not, we will collect loans and will not participate in a paid-in capital increase
GM Daewoo lost about $2.6b in forward exchange transactions (a form of currency hedge) last year, exhausting its $2b line of credit with KDB. GM had asked KDB to roll these obligations forward and throw another billion dollars on the fire, a request it then reduced to $835m. The problem is that GM hasn’t raised enough money, or offered a larger equity stake in GM Daewoo. As a result, KDB is forcing GM to raise new equity, share licenses for jointly-developed vehicles and introduce a co-financial officer to look after KDB’s interests. Otherwise, the collections begin, with $100m due this month alone. And interestingly, money isn’t the only issue at play.
The FT-86 concept, based on an RWD variant of the Subaru Impreza chassis, has been revealed at the Tokyo Auto Show. And behold, the Toyobaru coupe of internet legend appears to be in near-production trim. With a 2.0 boxer four, a six-speed manual and a forecast base price of under $30k, the FT-86 hopes to live up to the promise of its AE86 reference point. If nothing else, it signals the possible end of a long winter for Toyota’s enthusiast lineup, which effectively went into hibernation when the MR-2 Spyder was canned in 2007. But don’t get too excited. The FT-86 production model won’t go on sale in Japan until “late 2011,” so it’s anyone’s guess when it will become available in the States.
Automotive News [sub] reports that the promotion of Lancia CEO Olivier Francois to Chrysler brand boss heralds a closer alignment of the two brands in the European market. According to AN’s Fiat source, Chrysler and Lancia will share products and distribution going forward, not mention a luxury mandate that has yet to convince the wider market. The association might lend a certain amount of panache to the Chrysler brand, which its former CEO Peter Fong has said should aspire to “a notch above Cadillac.” If nothing else, Chrysler will probably get a version of the next Lancia Ypsilon city car. And Lancia? A new Thesis flagship based on Chrysler’s LX platform, and “a car derived from the Sebring’s successor,” according to AN. In other words, a Fiat. Nothing about these product-sharing plans sound particularly exciting, considering they hardly get Chrysler and Lancia away from their traditions of peddling upscale versions of pedestrian grocery-getters. But Messr. Francois has kept Lancia from going the way of Oldsmobile through his Gallic brand of sultry marketing, like the Carla Bruni spot above (by the way, is that a Chrysler limo?). The hope is that the Francois panache can similarly rescue Chrysler’s efforts, but that’s a tall order for a brand with basically no competitive product. Meanwhile, does Europe need another brand of luxe Fiats?
I actually think right now is the best time to pursue an automotive career because all of the domestic automobile companies have been through the cleansing fire of sharp retraction — getting ourselves competitive on wage cost, reducing capacity, getting rid of excess people and so forth … the UAW concessions on wages … etc. I see a genuine resurgence for the U.S. automobile companies, especially General Motors. So I think it’s a very good time to pursue a career.
Maximum Bob Lutz gives Northwood University students some of the worst career advice in recorded history [via MLive]. But to be fair, Lutz can imagine at least one scenario in which GM won’t regain its former glory…
The Detroit News reports that nastiness between Chrysler and its former overlords at Daimler could prevent the much-needed (by ChryCo) launches of new versions of the 300/Charger and Grand Cherokee/Durango. Apparently production of these new products can’t take place until Daimler and Chrysler agree to terms for Daimler-supplied components. Chrysler needs to resolve its legal differences with Daimler within 20 days in order to prevent delays to the roll-out of the Grand Cherokee/Durango. If the conflict continues, Chrysler admits it won’t be able to find a new supplier until January 2011. The Grand Cherokee/Durango and 300/Charger are planned to be Chrysler’s only 2010 debuts.
Automobile Magazine, Motor Trend and Ford’s Advertising Department bring you 6versus8.com. If you were waiting for a last straw to cancel your subscription, this should just about do the trick.
My girlfriend drives a 1998 SL2 with 185/65/15 tires. One of the four tires has started to dry rot enough that I have to add about 5 psi every two weeks to keep it near it’s neighbors. FWIW the sticker recommends 30psi front and 26psi back but I’ve found the car rides better if I inflate to ~35psi front and ~32 psi rear. The difference is especially noticeable going over speed bumps which are common in my neighborhood and around town. The reality is that the car sees regular use but in mileages that are low enough that dry rot will end a tire before the tread is gone. I don’t need super long tread life. I am however concerned about it being a truly all season tire. Snow depth here is a non issue but dustings of snow, ice, heavy rain, light rain, frequent rain, did I mention rain, oh and dry roads are common. Seriously we are in the SouthEast but East Tennessee is full of hills and valleys.
We jumped on Alan Mulally last week for sitting quietly on a $2.5b offer for Volvo from the Chinese automaker, Geely. At the time we told him to take the offer and be glad of it; after all, no one else would pay that much for a brand that hasn’t made money in nearly a decade. Or would they? Of course Alan knew more than we did, and over the weekend the truth emerged: Volvo has another bidder! The Wall Street Journal reports that the Crown consortium, led by Ford director Michael Dingman and former Ford and Chrysler executive Shamel Rushwin, are making a play for the Swedish marque. Crown is trying to lure former Volvo executives (including former CEO Roger Holtback) on board with a third of new Volvo equity in hopes of “emphasizing the Swedish nature of the company.” But can Swedish roots (or at least a good dye-job) match up with Chinese cash? The downside to the Geely bid is that the new company would walk away from pension obligations and inventory, making the deal worth less to Ford than the offered $2.5b. Meanwhile, SAIC is reportedly still in the running to buy Volvo as well. This one is still far from over.
Automotive News [sub] reports that GM has announced plans to roll out a police-only Chevrolet Caprice in 2011, based on the Holden Statesman. V8 and V6 version of the Caprice Police Patrol Vehicle will be available for order in late 2010, giving GM a competitive entry in the police cruiser market long-dominated by Ford’s Crown Victoria. Though this photo is an official GM image, spokesfolks warn that details aren’t completely finalized yet. “Some of the elements, some of the styling will be different in the production version. We are not releasing all the details in terms of specs at this point,” say GM’s Brian Goebel. Just don’t expect the changes to be major upgrades, because they are intended “to bring it in line with the Chevrolet look and feel.” GM’s RWD cop car comes just as Ford has hinted that it will develop future police vehicles based on the FWD Taurus. Meanwhile, if you want a civilian version of the Caprice, you’re stuck waiting on future police auctions. Sorry.
Ask a gearhead about Chinese auto styling, and the adjective most likely to come up is “derivative.” Or at least “crude.” Cars like the Rolls-aping Hongqi HQD helped build these unflattering associations, but this picture proves that they aren’t always true. This HQE, the chosen chariot for Hu Jintao’s National Day parade appearance [via Gasgoo], reaches back to FAW-Hongqi’s own heritage (rather than, say, the Robb Report) for inspiration. That’s a good trend for an industry that was fast becoming a car blog punchline.
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