“As the Nano is a city car, Tata has made low-speed acceleration a priority. The sprint from 0-60mph takes an epic 30 seconds and top speed is a mere 65 mph, but the very short first and second gears ensure it covers 0-40 mph in a much more acceptable 10 seconds.”
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Posts By: Edward Niedermeyer
With what one hopes is feigned incredulity, the Freep‘s Sarah Webster marvels at how political the issue of GM’s bankruptcy has become. “I must confess,” writes Walker with a conveniently wide-eyed naiveté, “I was quite surprised when the issue of whether General Motors Corp. or Chrysler LLC should file for bankruptcy took a turn to the political when the automakers first approached the federal government for a rescue package last fall.” Yeah, it’s a shocker alright. But why is Walker so surprised?
You know that advertisement for the Cadillac Escalade Hybrid where a douchey fellow suggests that “they should hybrid (sic) this thing”? I would post the video, but it seems that Cadillac has pulled all trace of the spot from the interwebs leaving only the marginally less insipid “cupholders” and “checkmate” ads on its website. And though it’s strange to plumb the Tubes of You for hours and not find this mythically inane third ad, it’s disappearance down the memory hole isn’t surprising at all. The spot suggested a troglodyte’s approach to hybrid technology that is only underscored by the reality of GM’s hybrid strategy: quick-n-dirty BAS, expensive and complex two-mode system, and moon-shot EREV. Hybrid this. Okay, now hybrid that. [ED: Zammy found it!] But Nissan’s announcement today that it will be bringing a hybrid version of its Infiniti M to the US market in 2010 has to put the Japanese firm in contention for worst hybrid strategy around.
Daimler has announced that it will raise $2.67 billion to fund future operations, reports Automotive News [sub]. But since we know that the BMW share swap has been nixed by the Quandts, how is Daimler coming up with the cash? By snaffling Opel’s cash from the German government? Or perhaps by jumping on the DC bailout express? No, Daimler followed the real money back to the Persian Gulf. Abu Dhabi’s Aabar Investments (owned by the state-run International Petroleum Investment Company) will buy a 9.1 percent stake in the German firm. After all, when you’ve repeatedly been fined for violating CAFE standards, you go to the oil wells, not the halls of government for your cash injection. The Emirate of Kuwait had already owned a 7.6 percent stake in Daimler, an investment that has been diluted to 6.9 percent by Aabar’s investment. But according to the analysts, Daimler had little choice but to take Aabar’s cash.
Lambo’s abortion-for-four is “on ice,” reports Autocar. Because of “me-too” positioning and questionable styling? No, apparently “the timing and market conditions are just not right for an additional model line,” says Lambo’s R&D boss, Maurizio Reggiani. That’s it? What about a nice, reassuring “Lamborghini refuses to build bland, uninspired vehicles in a faddish niche just because several competitors are” retort? Or, perhaps, “we encourage the folks behind the new Lagonda to join us in supporting death with dignity for similarly useless concepts”? No? Fine. Blame the economy. But file this one under “creative destruction.”
Kroymans Corp of the Netherlands plans to file for bankruptcy and shame the General, reports Automotive News [sub]. GM’s importer for Cadillac, Corvette and Hummer in European Union markets will “transfer” the distribution business to GM, “a process it expected to complete by next year.” Har. Har. By the way, has everyone filed their taxes already? It’s best not to wait until the last minute with these things. Your money is urgently needed to allow the CTS sportwagon roam free in its natural environment.
Bloomberg sat down with Car Czarlet Steve Rattner to find out what he learned from his recent visit to Detroit, and his answer should surprise nobody: the automakers need more cash. When asked if aid to GM and Chrysler could be as high as $30b to $40b, Rattner replied “It could be considerably higher, I won’t deny that.” Yikes. Or should we say, yawn. Who didn’t see this coming? The folks in charge, of course. “What they’ve asked for depends on them achieving plans that are somewhat ambitious,” Rattner said. “Like all management teams they tend to take a reasonably, slightly perhaps, optimistic view of their business. So it could be more, I can’t rule that out.” Does that explain Chrysler’s recent proclamation that it’s better off than GM? “There’s no real uptick, no real sense that the company would generate meaningful amounts of cash flow on a stand-alone basis,” Rattner says of the Pentastar mess. “We have not made a determination on whether they could exist on a stand-alone basis, but we do find their idea of partnership with Fiat a worthy idea to consider.” Rattner says the Presidential Task Force On Autos will give a sense of its direction before the March 31 deadline, and will likely set a hard date for union and bondholder concessions because, as Rattner puts it, “nobody wants to go first.”
China’s Chery motors has apparently decided that its fruity moniker isn’t strong enough to carry its market ambitions, and it has launched two sub-brands, creatively named Riich and Rely. Riich’s Bentley-aping winged “R” makes no secret of its premium brand ambitions, and China Car Times reports that the sub-brand will offer “technologically rich vehicles at a low price.” Rely looks to be more of a Buick or Volvo-style, entry-luxury brand. Perhaps Chery would like consumers to think of its sub-brand as “reliable”? From the US-market perspective, these branding exercises are quite crude. Not only do they closely copy existing brand imagery (did I mention that the Riich badge looks like Bentley’s?), but their names are also overly literal. So it’s not likely that these two brands will lead Chery’s charge into the global market, but their presence begs a question that cuts to the heart of automotive marketing: are sub-brands ever a good idea? Or are they just usually poorly executed? For every Lexus or MINI which show that major OEMs can branch out of their core competency, there are two Merkurs or Scions warning how pear-shaped branding exercises can get. The fall of the house of General Motors proves that too many brands can be bad juju, but are there niches for brands out there that haven’t been considered? Or do niche vehicles strengthen mainstream brands rather than distract them?
“Bring on the infrastructure” roars GMC’s latest truck ad, erasing the images of American blight and decay that opened the spot. “If we’re gonna rebuild this country,” intones the tough-guy voice over, “we’re gonna need the truck that’s been doing the job for the last 100 years.” The ad, available at Jalopnik, is one tiny step away from being “brought to you by Sierra, official truck of the 2009 federal stimulus package.” On the other hand, Detroit has always relied heavily on the patriotism factor (however warped by the times), as this slightly older ad (that we could find an embed code for) proves. Maybe the latest effort just seems more cynical because, I don’t know, GM is already dependent on federal largesse. And for some reason, GM dealers seem to think the answer is more cynical posturing, reports AdAge. Dealers are “clamoring for a national ad campaign to counteract the daily drumbeat of negative news about whether the company will go belly up,” and GM’s Mark LaNeve admits that the bad news is “telling GM’s story for us.” Which heralds fewer sales-building, product-based ads and more bailout-baiting, “brand building” spots. So stand by for more of the “GM is America” nonsense.
The Freep reports that UAW president Ron Gettelfinger will not seek re-election when his term expires in 2010. The move is not unexpected as the UAW traditionally does not allow re-elections after candidates reach the age of 65. Gettelfinger will continue to lead the UAW negotiations with the Detroit automakers through the union’s conference in June 2010. “The minute that’s over, I’m done,” says Gettelfinger. And his timing looks to be impeccable (given the situation, natch). Though Gettelfinger oversaw the 2007 labor negotiations which introduced VEBA and two-tier wages, UAW wages will not reach parity with the transplants until 2011 at the soonest. Which means Gettelfinger will not technically be in charge at the exact moment the UAW officially ceases to have any relevance.
“If you look at it on a pure-business basis, we are clearly more viable (than GM),” Chrysler CFO Ron Kolka tells Bloomberg.
Green Car Congress reports that an “Open Fuel Standards Act” has been introduced which would require half of all light duty vehicles sold in the US to be flex-fuel capable. The legislation would ramp up requirements to mandate 80 percent flex-fuel capability by 2015. Since ethanol has been running into trouble of late, the industry’s plan now centers on forcing OEMs to bring flex-fuel capability across their lineups, which supporters say will drive greater availability of E85 pumps. The plan would also enable the proliferation of mid-range ethanol blends like E20 and E30, since E85-capable flex-fuel vehicles would also be able to run on the intermediate blends that the ethanol industry so desperately wants to become mainstream. The only waivers for this mandate would be for OEMs who can prove that ethanol fuels prevent plug-in hybrids and other alt-energy vehicles to flunk state emission standards. Meanwhile, as rules are being written for the Renewable Fuel Standard, and a group of Senators are moving to prevent the use of indirect land use change (ILUC) to calculate the total GHG output of biofuels.
The fellas at Autoexpress are saying it’s the “new MR2,” although there’s no indication yet that the planned hybrid coupe will rock the nameplate’s trademark mid-engine architecture. Toyota’s CR-Z fighter will be RWD though, making it the second rumored RWD Toyota coupe in the last year. The first, a joint Toyota-Subaru may or may not be on hold. “We have set a tough price point (expected to be around £20,000 ($28K)), as it will be easier to sell if it is affordable,” says Toyota VP Masatami Takimoto. “It has to be fun to drive, too, which means the hybrid set-up must be different to the Prius’s, with greater responsiveness.” If the hybrid coupe is “done right,” reckons Autoexpress, it will do 0-60 mph in seven seconds, while getting over 50 mpg. Looks like Honda isn’t the only firm trying to mate green with fun these days.
Good news, everyone! A finance company whose risky investments in auto and real estate loans required it to beg for $6B in bailout cash is at the ready to teach you the secrets of smart financial planning. According to a release at PR Newswire, GMAC “has bolstered its effort to provide consumers with personal finance education with a $20,000 grant to InCharge® Education Foundation, Inc. (ICEF). The funding will be used to co-sponsor a series of financial literacy courses throughout the country in 2009. The courses, named ‘Smart Edge by GMAC,’ are designed to help people make better financial decisions by providing them with information about budgeting, real estate and automotive finance, insurance, credit reports, credit scoring, and other tools.” Lesson number one? Pay your CEO $11.6M even if you’ve been bleeding red ink all year. Lesson number two? Savagely screw over the people your business relies on.
We knew, but we still weren’t ready for this.
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