Hear that tearing sound? It’s Washington Post car critic Warren Brown’s last shred of credibility being ripped to pieces– by his own hand, no less. If there was a single pistonhead laboring under the [false] impression that Brown was anything other than a Detroit apologist, this review of the craptastic Chevy Aveo will tempt that person to cross over to the TTAC (i.e. dark) side. To wit: “Mediocrity done well honors the middle. The front-wheel-drive Aveo is done well.” Only the front cupholder sucks. So, in sum, “It no longer feels like a neglected child. But it doesn’t feel special. It’s okay, adequate. Therein rests the difference between going to market with a car that will enhance profits and one that will erode them. Consumers are willing to pay only so much for “adequate.” If asked to pay more, they’ll balk — or cross the retail industry’s River of Denial to buy something they deem worthy of a higher price.” Huh? What Warren’s trying to say: the Honda Fit murders Chevy’s Korean-built American revolutionary, but the Aveo’s cheaper. “And that, ironically, makes the Aveo a darned good deal. It’s a good car: reliable, serviceable and fuel-efficient. It’s not special. But it’s priced right.” Question: why is Warren comparing the Aveo5 to the Fit? [thanks to inept123 for the heads-up]

A member of our Best and Brightest sent us some interesting auto industry stats, compiled by Senior equity research analyst at the Credit Suisse Group (CSR). Et Voilà!

• Big 3 dealer stocks declined by about 79,000 units, or 4.9%, to 1.55 million vehicles in August from 1.63 million in July. The 4.9% decline is favorable relative to the increase of about 1% normally seen this time of year.
• The larger than normal declines were a result of a combination of sharply lower production and significant incentive events. By maker, GM inventory fell 1.7% from July to August, while Chrysler and Ford shed about 7% and 8% of their dealer stocks, respectively.
• The smaller sequential decline in GM’s stocks, despite a very sharp sequential increase in the automaker’s selling rate, was the result of a relatively aggressive production schedule. GM’s production was down 25% year-to-year in August, versus a 49% cut at Ford.
• At August-end we find Big 3 dealer stocks to be about 16% above normal, with cars 12% overstocked, and trucks 18% overstocked. An increase in our truck mix assumption, to 47% from our previous 44%, contributed to a jump in our calculation of passenger car days’ supply, and to a decrease in light truck days’ supply.
• By maker, we find GM stocks to be about 17% above normal, with cars 14% overstocked, and trucks 18% overstocked.
• We find Ford to be about 12% overstocked, with cars about 9% above normal, and trucks about 13% above normal.
• We find Chrysler to be about 21% overstocked, with cars about 10% above normal, and trucks about 24% overstocked.
• We saw significant improvement in full-size pickup Trouble Spots at each of the Big 3 in August. A drop in the days’ supply was driven by an incentive driven sales surge at GM, and by deep production cuts on the Ford F-Series and Dodge Ram.
• Based on current production schedules, we see the Big 3 ending September about 26% overstocked. We see both GM and Chrysler overstocked by about 30%, while Ford should have a more modest 15% overstocked level.
• By the end of the year (under current production plans) we think GM will still be about 30% overstocked, with the overstocked position concentrated on the car side. Ford could find itself modestly understocked by year end.
• The excess car inventory at GM is being driven by an aggressive production schedule that calls for a 21% year-over-year increase in car output. By contrast, Ford is cutting car output in the second half. We think GM’s production schedule is aggressive and needs to come down.

Ever since TTAC began, we’ve been arguing that carmakers (including everybody) are making too many models for too many brands, denying themselves the benefits of customer loyalty and ever-improving design, mechanical and service-related excellence. Perhaps the recent “downturn” would convince these manufacturers to throttle back on the whole BUT WAIT! THERE’S THIS! thing. Nope. The automotive Powers that Be (and the pistonhead chattering classes) continue to adhere to The Magic Feather School of Flying Elephants New Product Development. In fact, now that Detroit’s lack of foresight has put The Big 2.8 in a paddle-less predicament at the top of excrement creek, they’re even more desperate to throw a four-wheeled Hail Mary. In this The Detroit Free Press is a more-than-willing accomplice. “10 vehicles that will redefine the auto industry in the next year” perpetuates the myth that a turnaround is only a vehicle– or ten– away. And the “winners” are… 2009 Audi A4, 2009 Chevrolet Traverse, 2024 Chevrolet Camaro (I kid), 2009 Dodge Ram, 2009 Ford F-150, 2010 Honda Insight, 2010 Lincoln MKT, 2009 Toyota Venza, 2010 Toyota Prius, 2009 Mazda6. Redfinition? You’re kidding, right? No Volt action? Damn! Meanwhile… Camry, Corolla, Accord, etc.

In keeping with tradition, GM announced it latest “wait ’til the weekend” share-price-rattling revelation: the automaker has agreed to provide an additional $4.6b support to former division and bankrupt parts maker Delphi, from $6b to $10.6b. Justifying the cash burn to Automotive News [AN, sub], GM said it’s doing the deal “to speed the auto parts maker’s emergence from bankruptcy.” Here’s the break down [via The Detroit News]  “Under the deal, reached after months of negotiations and outlined in a court filing late Friday, GM would assume responsibility for $3.4 billion of Delphi’s hourly pension obligations — up from $1.5 billion — and make payments totaling $1.2 billion through Dec. 31 to boost the supplier’s balance sheet.” In its press release, Delphi said the cash infusion will put it in a position to pursue exit financing, through an equity-based rights offering. “Pursue” and “secure.” Two different words. In other words, with Delphi’s U.S. business experiencing the same kind of turnaround that GM’s currently “enjoying,” the clock is still ticking on Delphi’s Chapter 7 liquidation.

In case you hadn’t noticed, I hate weasel words. If GM needs federal money to stay afloat, GM CEO Rick Wagoner should say it. Of course, that would open GM’s top suit, and all his fellow suitlings, to the long-delayed reckoning (a.k.a. a root and branch reform and anvil-shaped clock cleaning). So what we get is a hideously overpaid chief executive that’s willing to play rhetorical footsie in a [Bill] Cinton-esque style to secure an initial $25b your hard-earned tax money– without strings attached. “General Motors CEO Rick Wagoner said today that limits on use of low-interest government loans should be loosened,” Automotive News [AN, sub] reports from Rick’s testimony at a “so-called” [AN’s term] energy summit. “He called his recommendation ‘an amplification of terms’ rather than loosening. But he contended that a project that leads to production of vehicles with 10, 15 or 20 percent better fuel economy should qualify for federal loans.” Wagoner, who largely avoided talking about the loans, and didn’t mention either “b” word,  didn’t get a completely free ride. “Sen. Bill Nelson, D-Fla., chastised Wagoner for the auto industry always fighting fuel economy standards and predicted companies will be back next year for a financial rescue.” Ya think? Meanwhile, “A Toyota lobbyist walking nearby was asked what he says if a lawmaker asks about loan funding, and he said, ‘We’re staying out of it.'”

“I expect to win Olympic Gold, an Oscar, a Pulitzer, a Grammy, a Nobel prize, and a Nickelodeon Kid’s Choice Award, but a few of them will require medical procedures not yet invented, which in itself may lead to my Sainthood (or martyrdom if things don’t work out as planned). And I’d make a run for office if not for all the skeletons (not necessarily all of them my own). I’m humble yet arrogant. Dumb and yet a genius. And I love and despise all people.” Vincent Capece’s self-description on Helium (the website, not the gas) helps us understand who Vince is deep down, rather than professionally. I leave the Google forensics to our Best and Brightest, and point you to Capece’s rant pronouncing automotive journalism DOA, killed by the Internet. “Before this computerized revolution, automotive journalism was a prime example of basic economic theory. There was a limited demand for automotive writers and a growing supply of people with basic automotive knowledge and the ability to pepper a sentence with choice adjectives. This imbalance led to continually declining wages for automotive journalists because many of these “kids” were willing to work for “free rides in cool cars.” Unfortunately, this oversupply of underachievers swallowed up the Ken Purdys and Tom McCahills of the world and allowed few David E. Davis’ and Beverly Rae Kimes to emerge… Unless we can find a way to pay “real writers” to write about cars, there is no future for automotive journalists. I’ve been fortunate enough to rub elbows with some of the greatest automotive writers of the past 30-40 years (this writer is not in their league) and sadly they are a, literally, dying breed. I can’t remember the last time I met someone who could fill their shoes.”

Bloomberg has a tidy little article summing up the current state of play in the corn ethanol industry: game called on account of brain. Yes, not only are people beginning to realize that the “food for fuel” industry has its ethical “limitations” (food riots and rising prices at the supermarket will do that to a concept), but the realities of economics are giving gung-ho investors pause. As in, why should we put money into this boondoggle when there’s already tens of millions of gallons more production capacity than demand? (So much that E85 producers can’t get cheap corn, either.) The result: the end of the corn-based ethanol industry’s boom. And a big PR switch from “no one ever died defending a corn field” to talking about [non-existent] cellulosic-based E85. The Bloomberg piece ends with the revelation that even ADM’s man (gotta love that jet) is backing away from corn juice. “Asked whether Obama may reduce his support for corn-based ethanol as president, spokesman Tommy Vietor referred to an April speech in Indiana: ‘We have to recognize that corn-based ethanol is a transitional technology,” the candidate said then.” Oh wait… “An energy bill introduced by House Democrats Thursday would require all gas stations to add one alternative fuel E85 pump, a fuel of 85 percent ethanol,” The  Detroit News reports. “Currently, less than 2,000 of the nation’s 185,000 gas stations have an E85 pump.” And why is that, then?

No, obviously. Nor anyone else, apparently. Now that GM is spending more time trying to sell the HUMMER brand than the HUMMER brand’s products, there’s not much on the product news front. But there is something. “The iconic HUMMER H2 is known for going where no other four wheel drive will venture,” a GM press release proclaims [via Huliq News]. “The model breaks new boundaries for 2009 with standard E85 Flexpower capability on every H2 sold, making it the only model of its kind with can run on E85 ethanol.” Now there’s a claim. And just in case you thought boasting that your planet-killer poster child can run on a corn-based bio-fuel boondoggle that even tree-hugger’s have scorned, GM PR wants you to know… nothing much. About that, anyway. “Ethanol is an alcohol which can be distilled from a number of sources, ranging from renewable crops such as sugar cane, to biomass or waste materials. Particular emphasis is being paid to the need to utilize sources that do not affect the price of third-world food commodities. For example, GM is the leading automotive investor in developing E85 ethanol made from waste wood collected as part of forest wildfire prevention programmes. Undergrowth and dead trees that would otherwise be burned are converted into the ethanol.” Oh, OK, then. But GM is now trying to play-up the “E85 is cleaner for the air” arguement, which has never been properly verified. “In addition to reducing dependence on non-renewable petroleum resources, E85 ethanol helps to reduce greenhouse gas emissions and can reduce smog-forming carbon exhaust emissions.” H2 reucing greenhouse gasses? Talk about beating a dead horse.

Automotive News [AN, sub] reports that “For automakers [that’s Ford, GM and Chrysler] to get access to up to $25 billion in low-interest loans included in the 2007 federal energy law, Congress must approve roughly $3.8 billion in new spending to cover default risk.” Bailout-wise, U.S. House of Reps Majority Leader Steny Hoyer (D-MD) is on the case. Maybe. “Hoyer could not say precisely when or if any proposal would come before lawmakers for a vote before they are scheduled to break at the end of September — possibly for the remainder of the year.” That’s crazy talk! But if you want hardcore insanity, wait ’til Friday, when GM CEO Rick Wagoner hustles to the Hill to bring out his begging bowl in front of a Senate Energy Summit. The Wall Street Journal previews Rick’s party line: “The auto makers and their Congressional supporters also will argue that they need funding to meet new fuel-economy standards imposed by Congress, and that the debt markets have broken down in the credit crisis, leaving them few other options.” The WSJ reveals that Congress has 15 days to do the deal before our reps piss-off. Even worse (for Detroit) not everyone’s on board. “The industry’s chance of getting help may have dimmed, however the government announced it will provide a plan to provide as much as $200 billion in new capital as part of a takeover of the country’s main providers of funds for home loans, Fannie Mae and Freddie Mac… Last week, Sen. Orrin Hatch (R., Utah) said he was concerned about the amount of money. ‘We don’t want our automobile industry to go down, but on the other hand, they’ve made a lot of bad choices.'” While I bet they get the bucks, methinks Rick’s cruising for a bruising.

So Google is planning to take over Yahoo’s internet search-surrounding advertising, scooping-up 80 percent of the market. Needless to say, the move has seriously pissed-off Microsoft, which scarfs the crumbs off that particular table, and tried to buy Yahoo’s ad interests before Google (not to mention Microsoft’s experiences on the business end of a U.S. Justice Department (DoJ) anti-trust case). Advertisers, who know a cornered market when they see one, are also chagrined (i.e. litigious). The UK’s Independent (discovered through an ad-free Google alert) reports “The Google-Yahoo alliance is scheduled to go into effect next month, but last week the Association of National Advertisers petitioned the DoJ to block it. The trade group, whose 400 members include Procter & Gamble and General Motors, said it would drive up ad rates and hand too much power to Google.” But wait! There’s more GM, if only hypothetically. “The two Silicon Valley giants have argued in the past that outsourcing Yahoo’s search advertising was akin to General Motors using Toyota’s hybrid technology, which does not lessen the ferocity of competition in the car industry.” Anyone remember Rick Wagoner’s “secret trip” to Japan to talk to Toyota? If only…

Followers of this Silicon Valley saga will remember that Tesla decided to install “termporary” transmissions in their lithium-ion-powered Roadsters, so they could deliver something to someone sooner rather than later. Well, later is now. Autobloggreen reports that Tesla is “ready to build real cars.” By that, scribe Sam Abuelsamid means that the electric vehicle maker is finally ready to fit its well-heeled tree hugger-mobile with a proper working transmission, courtesy of the Borg-Warner. Oh, did I say now? It seems that “now” means “later.” The automaker’s spinmeister– who has yet to provide TTAC with its promised test drive– reports that his employer’s delivered 27 cars, with another 23 in progress. But rather than stop the presses and deliver the 23 in-build autos with the new box, eleven lucky Roadster owners will get the old tranny– and a free upgrade later. At some point. In fact, I wonder whether Tesla will give priority to the expensive, time-consuming and technically challenging free retrofits or the [relatively] simple continuation of full production (and msrp) Roadsters? Anyway, the new production fantasy plan is in place. “Tesla will ramp production starts from four cars per week to ten per week,” ABG reveals without question. So, 520 per year @ $102k each? I make that $53m gross income, if Tesla can find 520 willing buyers before some other EV-maker creates the next big thing (Fisker Du?). Can Tesla survive on that? Doubtful. Underpriced and under-developed. Sweet.

In T. Boone Pickens’ latest TV campaign, the aspiring compressed natural gas kingpin patriotic oil addiction interventionist points out that most Iranian autos run on CNG. According to T., that’s because they save the oil for export to saps like us. It is a shameless, outrageous manipulation of the facts. The former Texas oilman forgets to mention that Iran imports some 40 percent of its gasoline– which still isn’t enough to satisfy demand. The Iranian government has rationed gas since last year, with predictable consequences. The New York Times reported on the result back in June of ’07: “Unrest spread in Tehran on Thursday, the second day of gasoline rationing in oil-rich Iran, with drivers lining up for miles, gas stations being set on fire and state-run banks and business centers coming under attack.” In fact, according to Iranian analyst Saeed Leylaz, “We are importing gasoline from 16 different countries. The country would be on the verge of collapse if they suddenly decide not to sell us gasoline. The government has to find a way to lower the consumption.” Which leads us to the aforementioned CNG and dual-fuel vehicles. Green Car Congress confirms the country’s switch to natural gas, reporting a sales jump from 20k to 429k CNG-powered cars per year. Even if you trust those numbers (courtesy Iranian Minister of Industries and Mines Ali-Akbar), do we really want to imitate a state-controlled automobile industry? And by you I don’t mean Detroit or T. Boone Pickens, obviously.