No biggie. A social call to one of our writers, thanking him for the infotainment. Needless to say, we tried to get Big Al to tell us something, anything newsworthy. Nada. Not a sausage. Still, I remember when I started this website. Back in the day, Peter DeLorenzo hyped his Autoextremist site with banners proclaiming “Bob Reads It,” “Rick reads it” and… what was it again? “Tom?” “Dieter?” I wondered if a) it was true and b) TTAC would ever gain sufficient prominence to catch the ear of the ultimate insiders. So, anyway, it’s another milestone for TTAC. Suffice it to say, talking to the industry swells will not give us swell heads. We will never forget that our first, indeed our only obligation is to you, our readers. In that spirit, when we hit the North American International Auto Show, we will do our level best to report the truth about cars. As always. Meanwhile, if Mr. Mulally could call us back re: an interview, I’d be most appreciative.
Posts By: Robert Farago
What’s up with The Detroit News? When it comes to partially or completely unattributed rumors surrounding the GM – Chrysler merger, there’s no source vague enough to warrant exclusion from their news pages. But when they’ve got a hold of a really juicy rumor, they get all coy on us. There’s no reason for “GM mulls Tiger Woods’ Buick contract” to exist– other than as a nudge, nudge, wink, wink word in your ear Guv’nor that The General and The Tiger are about to go their separate ways. How’s this for a suggestive juxtaposition: “Buick, which has had an endorsement agreement with the world’s No. 1-ranked golfer since 1999, has no plans “right now” to scale back its golf sponsorships, [Woods’ agent Larry] Peck said in a telephone interview. The company’s stock has dropped more than 74 percent this year to $6.19 at Wednesday’s close, and GM has cut 53,000 union workers since 2005.” Given The General’s exsanguination, Woods’ other agent was appropriately sanguine. “I want to see where they are, and they want to see where we are,” [mark] Steinberg said. Will they wave at each other? You know, as GM says goodbye? Look for a Tiger at a BMW, Mercedes or Audi-sponsored event soon.
Before I rip you-know-who a new you-know-what, let me just say that if you haven’t sampled Alex Nunez live blog diary (oxymoronic but there you go) of the new Knight Rider TV show, it really is worth the jump. I don’t know if Alex is gay, but it’s the cattiest thing in the history of the world, ever. Pulitzer-prize poetry, I kid you not. (e.g. “Now we get to the part where Mike curries favor with Cooperman. KITT’s got Mike’s six. Mike punches Cooperman’s girlfriend in the face, because she talked more trash to him, and he wasn’t tied to a chair with a firehose blasting him in his grille. We go to commercial.”) OK, now to the intra-blog attack… “Green car advocate proves first hand how small cars aren’t deathtraps” is a completely irresponsible post. While we’re happy that gas2.0.org’s Nick Chambers walked away from a bad smash in a Toyota Yaris (three-star front and rear side safety ratings), his anecdotal experience proves precisely nothing about small car safety. As our post on small car insurance indicates, statistically, there’s another, more credible POV on this. We’d expect Autoblog to be more responsible in its reporting. Or, in fact, not. And as long as they’re not, TTAC will be there.
So much for editing on my iPhone. Anyway, again, it’s nice to see The Ascot-wearing one finally acknowledge the fact that the people running GM are clinically insane. In fact, Jerry Flint’s Road to Damascus moment is so powerful that it miraculously transforms the Forbes’ columnist’s prose into something altogether more readable than usual. “Let me make this clear: Any merger between General Motors and Chrysler would mean the death of Chrysler and another coffin nail for GM.” Crystal. But Jerry can’t just leave it at that. Oh no, he’s got to shoot down my theory: the Chrysler merger is a cash-grab to sustain GM and better position the artist formerly known as the world’s largest automaker for federal bailout bucks. In fact, Mr. Flint thinks the whole idea is… silly.
Not bad, you know, considering. Considering that Chrysler has pretty much stopped spending money on capital expenditure (small stuff like developing new cars). Even so, ChryCo was quick to launch its crack [smoking] damage control squad. “Chrysler issued a statement saying that the second-quarter loss is $660 million when taking into account the differences between international and U.S. accounting standards,” The International Herald Tribune reports. “The Auburn Hills-based company says Chrysler’s automotive operations lost $570 million, with the rest of the loss attributable to Chrysler Financial.” So, that’s alright then? Anyway, Chrysler is continuing to negotiate with Daimler to buy the German’s automaker’s remaining share in the Crisis Corportation. “On a conference call this morning, Daimler Chief Financial Officer Bobo Uebber said negotiations with Cerberus continue. Cerberus is seeking to buy all of Chrysler and is negotiating with General Motors Corp., the combined Nissan Motor Co. and Renault SA, and other companies for the sale of Chrysler.” Yup, that about covers it.
Edmunds Inside Line (TTAC takes the racing line) reports that Pontiac has decided to let the critically-acclaimed Pontiac G8 die on the vine. “According to sources,” Edmunds reveals, in the style to which automotive journalists have become accustomed. “Pontiac will not get a version of the next rear-drive platform that underpins the Australian Holden Commodore.” Still, you’ve got to give Eddy credit for sarcastic snark. “This move is indicative of a fundamental switch in direction for Pontiac, the General Motors division that just a few years ago was envisioned by Bob Lutz to be the American BMW. The deaths of the Solstice and the eventual discontinuation of the next-generation G8 will leave Pontiac with zero rear-wheel-drive vehicles.” So, one wonders, how does GM sum-up this “new direction?” Dead brand walking? Nope. “Inside Line says: You’ve still got plenty of time to pick up your very own G8 — the high-horsepower GXP and the quasi-pickup-truck ST versions are still to be introduced. But you don’t have forever. — Daniel Pund, Senior Editor, Detroit” Nor, of course, will your G8’s residuals be very healthy. Just sayin’.
Cost-cutting carnage continues at the artist formerly known as the world’s largest automaker. The Detroit News reports that GM spinmeister Tom Wilkinson has announced that his employer is “temporarily suspending company matching of its 401(k) program as of Nov. 1.” Also gone by the end of ’09: tuition reimbursement and adoption assistance programs. (Tommy is a good boy who loves working at GM. Won’t you open your heart and help find him a home?) Meanwhile, the DetN is doing what it can to help, claiming the moves arrive as GM “navigates the downturn in the auto industry.” (As a group of non-romantic viewers chanted during the first half of the movie Titanic, “Ice berg. Ice berg.”) Oh, and Tommy said the automaker’s buyout program for salaried employees has been “well-received,” though he refused to reveal the number of workers who accepted the offer. So how about an update on the jobs bank, then? No? Never mind.
Pistonheads reports that current and former world land speed record holders Andy Green and Richard Noble are teaming-up to drive a Bugatti Veyron 1000mph. Sorry. Did I say Veyron? I mean to say “a car powered by the engine from the latest Eurofighter Typhoon, topped off by a rocket that apparently uses an 800bhp MCT V12 racing engine as its fuel pump.” That’s a bit more rad than Green’s Thrust SSC, seen here during one of its high-speed passes in Black Rock Desert, Nevada. But don’t head for the Sagebrush State just yet; PH says Black Rock “may be ruled out [for this attempt] as the annual Burning Man festival has apparently damaged the surface too much.” The team’s christened the new vehicle Bloodhound, after project aerodynamicist Ron Ayers’ first surface-to-air missile project. Surface to air? Uh-oh.
Regular readers of this series will be familiar with the farrago of taxpayer-funded market distortions used to keep the E85 industry afloat. You’ll be familiar with the government “grants” bestowed upon gas station owners and fleet operators, to help them pay for the cost of offering 85 percent corn juice to customers who don’t seem to like it much, at all. So far, so patriotic (I guess). But here are a couple of new wrinkles, brought to you by Crains Business Detroit. First, Crains tells us that “The Michigan Energy Office has awarded a $125,000 grant for an Ypsilanti-based organization to offer incentives for service stations and public fleet owners to convert to ethanol. The Clean Energy Coalition will offer assistance covering half of the conversion costs to E85, up to $5,000 per site.” So government bureaucracy isn’t enough; MI needs a GM-supported non-profit to pay their own overheads with taxpayer money to dole out the dough. Sweet. And here’s another new one: “Under the program… Station and public fleet owners must commit to purchasing E85 for at least three years after receiving incentives.” So, even if the public [continues] to turn its back on “this increasingly requested fuel” (Michigan Department of Labor & Economic Growth Director Keith Cooley), the stations have to keep buying it? And put it where, exactly?
Automotive News [sub] begins the day with a snippet from former Chrysler and current Chrysler Prez Jim Press. The headline grabs a quote from Jimbo’s address at the ironically-named Convergence 2008 conference. Press’ exhortation tells a tale of corporate defiance and American grit: “Dontcha wish your pension was hot like mine?” Just kidding. “We’re going to be here,” Press pronounces. How inspirational is that? But credit Jim for a sense of humor, you know, providing you don’t actually work for Chrysler. “He said he had to acknowledge ‘the elephant in the room,’ then quipped, “There is a lot of distraction in our industry that is fueled by speculation. All I ask is stop reading the newspaper.” What’s a newspaper? Anyway, like any Motown exec wearing a golden parachute, he just had to take it that one step too far, explaining why GM is intent on swooping down on ChryCo to hoover its cash and pick its bones clean and leave it for dead (which it will be). “Our strategy is working. Maybe that’s why lots of people are sniffing around the Chrysler vault lately.” Yeah, that must be it.
Manny Lopez is the guy in charge of auto coverage over The Detroit News. And it looks like the paper’s Head Cheerleader has pommed his last pom. “Failing to match revenue with expenditures or supply with demand has pushed Detroit’s automakers to the brink of extinction in varying degrees. Certainly, layoffs, plant closures and restructuring plans are steps in the right direction, though they’re long overdue and unable to make a significant difference today.” Uh-oh. Lights out, Manny? Of course not. Even the title of Manny’s dietribe [sic]– “Repairs to auto industry can’t wait”– promises RX for Motown. And make no mistake: the scribe knows the stakes. Well, he knows someone who does. “‘Too many people, falsely, think the auto industry doesn’t matter to them or their state. And they’re dead wrong. It matters to every state,’ U.S. Rep. Joe Knollenberg, R-Bloomfield Hills, told me Tuesday. ‘It matters to America. The saying is still true: What’s good for GM is still good for America.'” OK, Manny, fire away. What should your hometown heroes do to pull the fat from the fire. “He’s absolutely right, but America won’t care until we fix what ails us here, first. And we’ve got to find a way to do it today, not tomorrow.” Yes, yes. What now? Manny? Manny? Hello?
Jesus, can I stop blogging now? Apparently not. Bloomberg reports that “Michigan lawmakers are asking Federal Reserve Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson to use their authority to ‘promote liquidity in the U.S. auto industry,’ according to a draft letter they plan to send tomorrow. The letter will ask the Fed and Treasury chiefs to use their authority under the Emergency Economic Stabilization Act [EESA] to help the ailing U.S. automakers.” Question: how do you define sensible? “The auto industry is facing unprecedented struggles, and it deserves a partnership from Washington,” Representative Joseph Knollenberg, a Michigan Republican, said in a statement. “I’ve fought for this kind of sensible assistance for years, and I hope we can make it a reality now.” In all likelihood, immediate “relief” will probably take the form of a federal buyout bad car loans. “Treasury Assistant Secretary Kevin Fromer, in a letter to Knollenberg earlier this month, confirmed that the EESA money could be used to buy car loans and mortgages held by auto-finance companies such as GMAC, Chrysler Financial and Ford Motor Credit.”
We have it from a private source close to someone familiar with the story who heard it from a friend who heard from a friend that you’ve been messing around GM has some [more] bad news to release this Friday. Of course, given GM’s m.o., that’s a bit like predicting it’ll be “partly sunny with a chance of showers.” We’ve been calling-up the usual suspects to try and identify these not-so-glad tidings– to no avail. (Hey! What a great name for a Chevy!) But we’re getting closer. Deep Throat heard of our puzzlement and sent us a link to this story from Bloomberg. Seems one General Motors is getting ready to axe some damn thing, or a bunch of some damn things, in advance of its third quarter financial report (BIG owee) and next Friday’s announcement (we hear, also from a person familiar with this kind of shit) of the Chrysler merger. “General Motors Corp. may initiate a new round of cost cuts because a planned $15 billion in asset sales and savings won’t be enough to maintain its liquidity amid deteriorating sales, people familiar with the matter said.” Our equally unidentifiable but totally credible guy says “I think the bad news on Friday is more job cuts at GM and possibly the end for some products like the Solstice/Sky. Since the dealers were told to expect some bad news on this date, it has to be some product cuts. Run through last months sales report and pick out the obvious weaklings. DTS? STS? SRX? Hybrid trucks? Saturn Astra? Buick LaCrosse?” Sad to say DT, it could be just about anything that GM makes.
Glengarry Glen Ross: “We’re adding a little something to this month’s sales contest. As you all know, first prize is a Cadillac Eldorado. Anybody want to see second prize? Second prize is a set of steak knives. Third prize is you’re fired.” If you think times are tough, and they sure as Hell are, imagine being a car salesman. Wait! Imagine being a car salesman trainer. Someone like… Jack Bennett (find him at youshouldsellcars.com, although his mantra is “you can sell cars”). Jack writes a regular column for Dealer Sales & Marketing. So, I wondered how Jack would take the current, uh, “challenges.” “I remember a time when I was working at a dealership and a technician came to the showroom. A salesperson was standing at the window with his hands in his pockets. The tech said, ‘All you sales guys do is stand around with your hands in your pockets.’ The salesperson turned and said, ‘Sometimes my job is to stand here with my hands in my pockets.’ And you know he was right. This salesperson is trained to do one thing: serve people. So when the letters have all been sent out and the follow up calls made, sometimes he has to wait for the people to serve.” Read more? Well it could change your life.
From Autoblog: “Motor Trend was equally impressed during a recent trip to Chrysler’s Arizona proving grounds where they brought their considerable testing equipment along to add their own cold hard stats to a growing list of platitudes.” [thanks to Steven Wilkinson for the tip]
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