Detroit News columnist Daniel Howes is just coming around to the idea that Detroit’s automakers are about to collapse, bringing about the reckoning that any open-minded journalist could (and did) see twenty years ago. And Danny’s pissed. At us. “It’s easy, sitting behind a keyboard, to type, ‘no one’s too big to fail’ or ‘let ’em file Chapter 11′ or ‘serves ’em right.’ It’s especially easy if you and yours don’t have to endure directly the jobs lost, tax revenue gone, pensions halved, health care benefits denied, dealerships closed, supplier lines shut down.” Is this how Detroit thinks of its current predicament? Fortress Detroit? That they’re somehow blameless victims in all this, and America actively WANTS them to fail? Apparently so. “But autoworkers, salaried employees, retirees, even executives, are people, too. The nasty Schadenfreude heaped on this dismal situation says more about those doing the heaping than those who go to work each day, do their jobs and play by the rules.” Danny goes for an “if… then” close…

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The Motley Fool says satellite radio is too big too fail. Kidding! But point taken. “In reality, there’s no good reason for the government to step in and save satellite radio. It’s a terrible business that’s done nothing but pile up losses and disappoint shareholders. It can’t compete with the Internet, podcasts, or MP3s. The business destroys value. If the government were to loan it money, it would never see that money again. Bailing out satellite radio is a ridiculous notion. No one — not even the politicians in Washington (let’s hope) — is considering it. Yet Washington is considering a hefty bailout for U.S. automakers — an industry with much more in common with satellite radio than anyone would like to believe.” The rest of the piece argues against a Detroit bailout. It should give the American automakers’ political supporters pause’ it ends with an increasingly familiar call to readers to contact their reps to oppose the bailout. Take it from someone who surfs for a living (Jesus, is that what I do?): there’s a growing groundswell of public opinion against throwing money at Motown.

Well, well, GM CEO Rick Wagoner had a little chin wag with the boys over at Automotive News [AN, sub]. “General Motors CEO Rick Wagoner says GM’s financial distress is so dire that it must line up financial assistance from Washington before President-elect Barack Obama takes office in January. ‘This is an issue that needs to be addressed urgently,’ Wagoner said.” And that’s just for starters. “Now is the time to ‘overshoot, not undershoot; when it comes to assistance for the auto industry,” Wagoner pronounced, revealing that he’d rather be safe than sorry with your money. Makes sense to me, in a “TTAC earns a rep writing Gneneral Motors Death Watches” sort of way. In exchange for the money, Rick’s “willing to offer the government preferred stock, set limits on executive compensation and speed the introduction of fuel-efficient vehicles.” How… beneficent. And last but not least, Wagoner reckons the man who’s steered GM straight into the iceberg is the best guy to, uh, keeping ramming the ice. “Wagoner said he is not prepared to resign in return for government aid. ‘I don’t think it’d be a very smart move,’ he said.'”I think our job is to make sure we have the best management team to run GM. It’s not clear to me what purpose would be served…'” Love the ellipsis guys! Did Rick’s voice really trail off into silence? Nice touch.

Assuming Detroit is about scarf several billions of your children’s children’s children’s tax dollars, I think you have a right to decide what strings should be attached to the bailout bucks. So, what strings do you think should be attached to the bailout bucks? Although Washington and Detroit see all three ailing American automakers as much or a muchness, TTAC readers are well aware that there are three types of epic failure involved. In GM’s case, it’s everything: models, brands, dealers, advertising, management, product development, you name it, they’ve screwed it up (with the possible exception of pickup trucks). Some kind of wholesale management slaughter– from mid-level all the way to the Bored of Directors and every Wagoner, Lutz, LaNeve and Henderson in between– would at least give me some sense of vindication (and it IS all about me, no matter how much I protest). How you can restructure GM without playing the Chapter 11 “get out of 50-state franchise law and UAW contracts free” card is beyond me. But perhaps not you. (OK, now it’s about you.) In Chrysler’s case, how do you prevent those rat bastards at Cerberus making a penny on this deal at any point ever? And if GM’s glue-on-the-hoof, what of Chrysler? Personally, I’d rather invest in Tesla. But as Pooh says, what to do? What to do? Or is that Eeyore? Ford is the Golden Child. Or, more precisely, the kid who’s coughing but not showing any other signs of plague. Yet. Seems to me they’re on the right track, but running out of rail. And maybe we should get rid of those pesky Fords who call the shots at Ford (I originally typed “shits” but that’s just my subconscious talking). Or not. I dunno. I’m thinking about all this for an editorial. Little help?

“Shares of GM fell 23% to $3.34 in late-morning trading,” The Wall Street Journal reports. “After earlier hitting a 62-year low of $3.02, as analysts at both Barclays Capital and Deutsche Bank cut their target prices and investment ratings on the stock. Barclays now targets GM shares at $1, while Deutsche Bank slashed its target price to zero… Deutsche Bank analysts, who cut their rating on the stock to ‘sell’ from ‘hold,’ gave GM a shorter liquidity timeline, saying the company might not be able to fund its operations beyond December. Even with government intervention, the analysts said GM’s future is ‘bankruptcy-like,’ and shareholders are unlikely to get anything.”

TTAC has highlighted the inherent obscenity of GM CEO Rick Wagoner’s compensation for flying the artist formerly known as the world’s largest automaker straight into the ground. While Wagoner inherited enormous structural problems from his predecessors, he has done nothing to correct them. Throughout his administration he’s shown a startling lack of courage and foresight, no product savvy whatsoever and an abject inability to face-up to the reality of GM’s peril.  And yet he has drawn down over $100m in direct compensation since his installation at the top of the GM pyramid. This reporter (that’s me) was widely and loudly ridiculed when he cried foul at Wagoner’s bankruptcy-proof pension (and for asking if GM Car Czar Bob Lutz enjoyed same). Lest we forget, Wagoner’s compensation was INCREASED (a.k.a. “restored”) in April to $14.4m per year (and the rest). That’s more than all top ten of Toyota executives combined. Make of that what you will, but how can The New York Times report GM’s cutbacks in white collar retirees’ health care without putting their sacrifice (small as it may be) into its proper context? Surely, it’s time someone asked the question: why is Wagoner still getting paid?

Automotive News [sub] reports that Toyota is set to re-start Tundra production in their $2b San Antonio plant– although consumer demand for the full-size pickup is only obvious by its absence. “At the end of July, Toyota had about 60,000 Tundras in inventory, of which 45,801 units were in dealer stock. At the end of October, dealer stock had fallen to 29,784, according to Toyota. But Tundra sales have fallen sharply. Initially, the company had hoped to sell about 20,000 a month. When the economy began to slow late last year, the forecast was revised to about 15,000. In recent months Toyota has fallen well short of hitting its goal. Combined September and October sales were 14,121 units, off 62.3 percent from last year.” Even $10k on the hood of a brand new Tundra ain’t movin’ the metal– although it is disappearing any hope of obscene profits. “I have no doubt that there is a pent-up demand,” said John Matthews, managing partner of Pat Lobb Toyota of McKinney, Texas. “If I don’t see another Tundra until January, I’ll be happy,” said Jeff Daniels, general manager of Toyota of Muncie in Indiana. Imagine how Chevy dealers feel. Anyway, as commentator JT rightly points out, ToMoCo is ramping-up production to ship these bad boys to the Middle East. Hey, given fixed costs, they might as well do something with them.

Unbelievable, The Wall Street Journal has an editorial that positions the paper four-square against a federal bailout for Detroit’s beleaguered automakers– and then wimps out. First, the “not with our money you don’t” bit. “A bailout might avoid any near-term bankruptcy filing, but it won’t address Detroit’s fundamental problems of making cars that Americans won’t buy and labor contracts that are too rich and inflexible to make them competitive… In fact, the main point of any taxpayer rescue seems to be to postpone a day of reckoning on those contracts. That includes even the notorious UAW Jobs Bank that continues to pay workers not to work. A Detroit bailout would also be unfair to other companies that make cars in the U.S. Yes, those are “foreign” companies in the narrow sense that they are headquartered overseas. But then so was Chrysler before Daimler sold most of the car maker to Cerberus, the private equity fund. Honda, Toyota and the rest employ about 113,000 American auto workers who make nearly four million cars a year in states like Alabama and Tennessee. Unlike Michigan, these states didn’t vote for Mr. Obama.” Hey! Place nice! Anyway, you get the picture– if only because we’ve been painting it for the last three years. But there’s a sting in the tail…

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Autobloggreen reports that the Saturn Vue plug-in hybrid vehicle (PHEV) is probably on ice. The wired Vue was due to become GM’s first– and pre-Chevy Volt– PHEV. Now, who knows? “During the General Motors third quarter earnings (or lack thereof) conference call on Friday, company executives discussed the vehicle introduction schedule for 2009 and 2010. Several cars that had been expected to debut during 2009 have been pushed back to the following year, including the Saab 9-4X and Cadillac CTS Coupe. GM declined to discuss any vehicles beyond the 2010 calendar year. One vehicle that notable by its absence in the list of vehicle launches is the Saturn Vue plug-in hybrid.” While we’re at it (or not), the hold-back on the Saab 9-4X also casts doubt on the Cadillac cute ute replacement for the SRX and the new Chevy Equinox; vehicles that were supposed to sit on the same platform. Equally important: each day that these and other GM vehicle programs are delayed, the more expensive it becomes to restart development, and the harder it becomes to catch-up with the competition. The delays also impact suppliers, who may go under in the meanwhile. But that’s another story, which we’ll get to a bit later…

First, again, my public thanks to our former Managing Editor Justin Berkowitz. In the interests of keeping the business afloat, TTAC has cut the ME position from our roster. Although Justin will continue to contribute to the site, we can no longer afford his full-time services. As and when we can, I’d be delighted to renew our more intensive association. Secondly, a TTAC commentator has complained that we’re heavy on the politics/business, light on the actual car coverage. And it’s true. As I survey the autoblogosphere this morning, there’s nothing but TTAC-worthy headlines everywhere (except for AB, obviously). While I will charge our freelancers with amping-up the [strictly-defined] auto news, I’ve decided to pursue the bailout story/U.S. auto market collapse full-throttle. It’s a story in which we’ve developed considerable expertise, and one that needs an independent voice. As someone with a lot more insight that I said, this too shall pass. But until it does, TTAC’s going to cover developments as best we can, on your behalf. Thanks again for your patronage and support.

[UPDATE:: OK OK. Forget the subscription model. Jeez!]

Back in June, Barron’s advised [what conservative talk show host Bill O’Reilly creepily calls] “the folks” that GM shares could triple in value. Oh how we laughed! Well, surprise surprise surprise! Barron’s [sub] is now eating their words. “STAGGERING. THAT’S A FIT DESCRIPTION of the calamitous decline of auto markets in developed nations this year. U.S. October sales numbers released last week were ugly, down 32% from the year-earlier level and slamming all car makers hard. The month’s annualized selling rate was a paltry 10.5 million vehicles, the worst in more than a quarter-century. The weak financial positions of Detroit’s Big Three — General Motors, Ford and Chrysler — means their survival is at stake, and that Barron’s was wrong in describing GM as a buy late last spring.” Hey, wait a second; that sounds familiar. Market sucks. Who could have predicted this? Not our fault for missing it… GM! Anyway, how ’bout them bonds? “Our enthusiasm for GM was clearly wrong, as was a suggestion that its bonds, like the senior note maturing July 15, 2041, would be more valuable,” Barron’s writes. “They now trade at 20 cents on the dollar, versus 60 cents when the story was published.” Man the lifeboats! What? They’ve already gone? Look for GM’s stock to die a death tomorrow [Monday morning]. Trading suspended? De-listing from the Dow Jones industrial Average? Anything’s possible, and all of it’s inevitable.

As we’ve just reported, Senate majority Leader Harry Reid has pretty much written-off the possibility of passing another bailout economic stimulus package before President-elect Barack Obama moves into the White House. Which leaves Motown SOL, in terms of their planned mega-suckle. And now that GM has publicly admitted that they can’t make it past December without some kind of public funds, Senator Reid and House Majority Leader Nancy Pelosi have changed tack. Automotive News [sub] reports that the dynamic duo have sent a letter to Treasury Secretary Henry Paulson asking for $25b worth of “emergency loans” for GM, Ford and Chrysler. “We must safeguard the interests of American taxpayers [!], protect the hundreds of thousands of automobile workers and retirees, stop the erosion of our manufacturing base, and bolster our economy,” the letter, uh, suggested. As TTAC  predicted, “The letter… recommended ‘strong conditions’ [for the loan] possibly equity stakes and limits on executive compensation, in return for any help. The government is requiring similar steps in its rescue of banks.” Equity stake? Nationalization by any other name would still smell like an old cadaver.

Senate Majority Leader Harry Reid has cast doubt on the lame duck Congress’ ability to ram through another multi-gajillion dollar bailout economic stimulus package– upon which GM’s hopes currently reside. Automotive News [AN, sub] reports that the Nevada Democrat reckons that the dems have no chance of passing “a very robust, bold stimulus package” before the new team hits the field. At least not without those pesky Republicans lining-up behind it. AN correctly concludes that this is a septic tank full of Not Good for Motown– especially as GM has just publicly declared that they’ll be out of cash by December (a fact curiously absent from AN’s coverage). “The Detroit 3 and the UAW last week asked congressional leaders to include in the legislation $25 billion in loans for retired autoworker health benefit trusts, called VEBAs. They also want the bill to prod the Treasury Department and the Federal Reserve into releasing other federal money as ‘bridge’ loans to get the automakers through the current economic crisis.” Reid’s run the numbers and… “Until the first of the year, I still have a one-vote majority in the United States Senate,” Reid told CNN. “I’m senior enough and experienced enough to know that you can’t do something with nothing. I need votes.” And here’s the kicker: “The leader specifically mentioned only increased unemployment compensation benefits as a priority in a stimulus bill, not aid to automakers.”

Whether or not you like to read car magazines on the throne, it looks like the only paper with a future is rolled up beside the bog. Starting with the January 5, 2009 issue, AutoWeek will switch from a weekly to a biweekly magazine. According to the pub’s press release, less is more. “This change gives us the opportunity to grow as a brand,” opines brave-faced publisher Keith Crain, “and increase our reach to enthusiast consumers, making AutoWeek much more than just a weekly.” (Or, in fact, less.) Needless to say, AutoWeek will not become AutoBiWeek (although one wonders if that name might open-up new profit opportunities). “Modifying the frequency of the magazine’s distribution allows us to focus on more comprehensive editorial features and vehicle reviews. We look forward to providing lengthier and more comprehensive pimpatorials, although our paper quality will go down the toilet. So to speak.” I just made the last two sentences up, obviously. But not this: “I’m thrilled to be able to make a great brand better,” said AutoWeekEditor and Associate Publisher, Dutch Mandel. “The changes demonstrate our commitment to evolve in an ever-changing world. Our readers now demand news the moment it happens, which we provide to them at autoweek.com. These changes will allow us to deliver more in-depth coverage in our products. Our readers will be excited and pleased.” In fact, they already have a new strapline with which they can take delight. “AutoWeek is America’s only fortnightly automotive enthusiast consumer magazine.”