BusinessWeek reports that Sirius-XM may soon go away. “Sirius signed top talent-including Stern, Martha Stewart, and Oprah Winfrey-to draw in subscribers. But programming costs have triggered heavy losses.” The now-merged former competitors have been on a two-decade spending spree, paid for with Godzilla-sized credit cards. Putting a name to the pain, Sirius-XM’s looking at $1b in debt’s coming due next year, without any way (otherwise known as positive cash flow from operations) to pay off the note. Sirius claims it can continue to fund operations and avoid filing for bankruptcy by raising money from existing lenders, who will be “flexible” about an additional $350n due in May.” Hey! I’ve done that! You get yet another credit card with which to pay the minimum payments due on the old card, right? Well, good luck with that. With people around the globe tightening their belts, and iPod connectivity in cars, you have to think that the satellite radio subscription will be one of the easiest spedning cuts motorists can make. And if there is a God, Howard Stern will find himself out of work.

BusinessWeek tells us that “cash is getting so tight at General Motors (GM) that management has launched another wave of cost-cutting. The company is even scrutinizing the electricity bills.” Just how much cost cutting is left to be done by these serial-cost-cutters? Yet more new vehicle programs are being delayed, with “sources” saying the Cruze has been put off until 2011 and the next generation Malibu pushed into 2013. BusinessWeek is even using the naughtiest word: bankruptcy: “The delays will save precious cash at a time when analysts say bankruptcy is a real possibility.” How bad is it? “GM is also looking at more miserly ways to save money. The company has told engineers and product development staff at its sprawling technical center north of Detroit to turn the thermostats down to 66 degrees and turn lights off after hours.” Nothing boosts productivity of the development staff like keeping it cold enough to discourage naps. But with critical programs delayed, what exactly is there for these well chilled engineers to do? Somehow survive until 2010, that’s what: “These are tough decisions, but the company has to save cash to stay out of bankruptcy in hopes of making it until 2010. By then, concessions in a new labor contract with the United Auto Workers will kick in, saving several billion dollars annually.” Are they really still hanging onto the old saw about UAW contracts being GM’s biggest problem?

Peter Lattman at The Wall Street Journal has nailed the banker’s motto: “In Cerberus we trust.” Remember when bankers were steely eyed, risk averse curmudgeons who would only lend money to those who didn’t need it? Hah, that was before the days of fee based income, monster annual bonuses and surgically enhanced trophy brides. “More than 40 elite investors from Citigroup Inc.to Third Point LLC put up at least $12 billion of the roughly $15 billion used to fund Cerberus Capital Management’s acquisitions of Chrysler LLC and GMAC Financial Services. Most even agreed to pay a fee for the privilege.” What a hangover. The banks are said to have already written off over $5 billion on those deals, and it ain’t over. “Cerberus long honed a reputation for buying companies others had left for dead”, and for doing so with other people’s money. “The firm boasts to its own backers how little of its $27 billion portfolio is allocated to the two deals — less than 5%. In his most recent letter to Cerberus investors, Mr. Feinberg didn’t even mention Chrysler or GMAC by name.” Never ones to let reality intrude, “investors have marked GMAC to about 50 cents on the dollar and Chrysler to about 75 cents on the dollar.” But hey, buying Chrysler was never about making money, that deal was pitched as a matter of “patriotic dut.” Hedge funds and bankers, the last real American patriots, right?

Japan’s auto manufacturing sector has relied heavily on guest workers in recent years, often from Brazil (thanks to the large number of Brazilians of Japanese decent.) “Japan has begun attracting large numbers of foreign workers only in the past 15 years to meet a labor shortage as the country ages,” the AP reports. “The increase has been rapid, more than doubling from 370,000 foreigners working legally in Japan in 1996 to 755,000 in 2006.” Japan is a famously immigration resistant nation, yet the allure of Brazilian nationals willing to work for $12/hour– instead of $20/hour rate for Japanese nationals– have cause a change in behavior, if not in attitudes. But now that hard times are hitting everywhere, the AP says these guest workers are being shown the door. Japan’s vaunted full employment tradition at major companies is built on a bit of a lie, or at least misdirection. There is a pecking order with full time employees of major name companies at the top and several layers of subcontractor assembly and parts suppliers below. The further down the chain you go, the lower the pay and the less the job security.  Guest workers are something of an embarrassment to Japanese citizens, and when times are tough, they are toughest for these “guests”. “‘The number of cars being produced is decreasing, so there’s nothing for the foreigners to make,’ said Masahiro Morishita, who works FujiArte, an employment agency that hires foreigners in Hamamatsu.” Foreign workers get the leftovers, never the main meal.

According to Tom Krisher of the Associated Press, “A person briefed on discussions about selling Chrysler LLC says the automaker could be sold in pieces to other companies… The person said Tuesday night that many combinations are being discussed. The person asked not to be identified because he doesn’t want to be accused of being a moron for stating the blindingly obvious the talks are private.” How… helpful. Meanwhile, independent talking heads continue to heap scorn on the idea of a Chrysler – GM merger, even as it looks like the deal’s going down (predicted for next Friday). Phil LeBeau over at CNBC shares his “Three Reasons for GM Not to Buy Chrysler.” Here on TTAC we’ve been talking about the parting out scenario since well before the Cerberus/Chrysler deal was done. With Renault-Nissan not interested in a wholesale merger and GM struggling to come up with the cash to make the merger work, parting-out seems like such sweet sorrow. Stay tuned.

In this breathless interview by an adoring newswoman, Elon Musk says that the Tesla Roadster is doing great! And that Tesla’s OEM supply business is doing great! And that the Silicon Valley electric vehicle maker (retrofitter? is slowing down on WhiteElephant sedan development because it’s the fiscally prudent thing to do so. Musk anticipates some cheap government capital in six months (courtesy of tax payers just like you), so why raise more money now? In other words of wisdom, Tesla’ self-appointed CEO says falling gas prices aren’t a concern for the company’s business plan because gas prices “aren’t the main reason” for buying a hot sports car which is “environmentally friendly.” (Hint: it’s all about green cred.) Officially, Musk has “no comment” about specific time frames for an IPO, but says it’s “within the realm of possibilities” that Tesla will fleece more investors let outsiders buy a piece of the automaker’s mean, green dream sometime next year. Meanwhile, if your idea of great reporting is a newsbabe hanging on every word of a sanctimonious rich guy, today’s your lucky day.

The imploding global auto market continues to, uh, implode. The Wall Street Journal reports that Nissan is scaling back worldwide production. Nissan Japan pulled 65k vehicles from its November through March schedule, and sliced 780 “temporary workers” from the payroll. (Little known fact: Japanese companies practice “full employment” by routinely classifying a large percentage of the workforce as temps.) Nissan’s September sales were downaround the globe, off 37 percent in North America, 27 percent in the UK, 23 percent in Spain and 5.5 perfcent in greater Europe. Nissan announced a two-week shutdown of its English Patient, er factory, and lopped 1,680 jobs off its workforce for Barcelona. Not a speck of good news anywhere. Ouch.

Today’s Wall Street Journal headline gets right to the point: GM doesn’t have the money to do the deal with Chrysler. As for sources, you have to believe either A) The WSJ’s making this shit up or B) the ongoing leaks are official and intentional (otherwise the leaker would have been found and stopped by now). Anyway, getting the tax payers on the hook is clearly a key element of the scheme:  “It is still early days, but to make people feel more comfortable or to get investors to buy in, you have to think a government role would be important,” said one person involved in the talks. “That role could take a lot of forms, but it would be very important. The government may need to make it happen.” American Leyland indeed. Back in the day, the British government was the shotgun toting papa who pushed the kids to the altar and provided a dowry. GM’s COO Fritz Henderson is said to be the driving force for doing some kind of deal here. Considering the job ol’ Fritz has been doing leading the General’s charge up recovery hill, you have to wonder why anyone is listening to him. “Meaningful cost rationalizations” is the rationale of choice for the deal’s advocates on the GM side.  But over at Cerberus the motivation is simpler; get anyone to take this fracker off our hands!  How exactly they expect to get the government to put taxpayer money into a plan predicated on firing tens of thousands of people remains a bit of a mystery.  Sanity may yet rule the day, but don’t count on it. Meanwhile, Nissan is said to be pursuing an alternative alliance strategy with Chrysler based on a cross-shareholding arrangement. If so, they must not understand the simple fact that Cerberus wants out, stat.

I’m willing to wager that a fair percentage of TTAC’s Best and Brightest take their cherished whip to the race track every now and then to drive the car as God and his engineers intended. If so, be warned: your car insurance may no be on the hook should something untoward– or straight toward– occurs.  The New York Times reports that insurers have closed the loophole that defined certain types of racing as a “timed event.” The fix is in; you’re liable. For some weekend warriors, it’s a bridge too far: “Chris Soignier of Austin, Tex., will not be taking his Porsche Cayman to the track, which he had done with his previous cars. When he read his renewal notice from Progressive Insurance last November, he found that the Cayman was not covered on the track. I don’t feel like I’m that much at risk, but the magnitude of the loss is too great for me to be comfortable,’ he said. For other motorized Walter Mittys, ignorance is a bliss balloon destined to pop. “Jerry Kunzman, executive director of the National Auto Sport Association, said: ‘Maybe 25 or 30 percent have done the research, the middle third just assumes they are covered, and the top third just don’t have a clue.'” Maybe the tracks should educate their customers on this issue. Just sayin’.

Remember how much people (OK industry wonks) sneered at the Honda Pilot and Ridgeline for being unibody designs descended from a minivan, which in turn was based on the Accord sedan? Well, Honda made some money on their trucks while the making was good. And now, along with everybody else, not. But while GM’s busy closing factories, Honda’s reaping the rewards of its investment in flexible manufacturing. They’re scaling down production of slow-selling Pilots and Odysseys, making room for more Accords. And they don’t need the United Auto Workers permission to do it. [The Wall Street Journal chronicles the swap.] The main U.S. Accord plant in Ohio will build more of the suddenly hot four-cylinder version. Honda also plans to cut back on Accord imports from Japan. One might think all this would be a plus for America’s balance of trade, but maybe not… Back in the day. the transplants used the U.S. to crank-out the new hotness, while letting Asia carry-on with the old. The new Honda Insight/Prius-fighter will be built in Japan.

If you’re wondering about the reason behind Toyota’s $250m zero percent marketing blitz, look no further than their very own job bank. Unlike The Big 2.8’s top-secret pool of idled workers, ToMoCo’s labor reservoir is a matter of company policy, not union contracts. With Tundra sales as frozen as the truck’s namesake (down 61 percent in September!), something had to give. The Wall Street Journal reports that “the Toyota plant here in southwestern Indiana and another in San Antonio, Texas, stopped making pickup trucks at the beginning of August. About half of the 4,000 workers are expected to resume making vehicles in November, and now Toyota says the rest won’t likely be back on the assembly line until at least April.” Putting a happy face on a bad situation, “senior plant manager Norm Bafunno said he can already see the benefits of the training. Mr. Bafunno cites a Teflon ring designed by an assembly worker during the down time that helps prevent paint damage when employees install an electrical switch on the edge of a vehicle’s door.” This problem was causing workers to have to do a bit of paint buffing on one or two trucks per shift, back when they were actually building trucks. Meanwhile, have you noticed how little news we’ve heard about United Auto Workers’ efforts to organize the transplants?

According to [yet more] unnamed sources for The Wall Street Journal, General Motors’ Board of Bystanders put the kibosh on a Chrysler merger deal. “Despite huge losses over the past four years, a plunge in GM’s stock price and growing worries about whether the auto maker has enough cash to turn itself around, GM’s board has continued to support Chairman and Chief Executive Rick Wagoner.” Nice set-up. “But the board’s cautious reaction to the proposed merger suggests it may assert itself more than in the past if Mr. Wagoner and his team try to move ahead with a Chrysler deal.” You would think that in times like this the board would be asserting its authority in, I dunno, setting the strategic direction for the company, rather than, say, simply reacting to the latest thoughts of the CEO whose wiped tens of billions off the company’s worth and plunged it into a terminal nosedive. But then again, reacting instead of leading is the GM way from top to bottom. Anyway, as that’s that, let’s hear what AutoNation’s CEO Michael “No Not That One” Jackson has to say about all this meshugas. Jump!

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