A TTAC source signs in with an interesting question:

I have one on “anonymous background.” Did you know members of the board of bystanders at Chrysler get new cars for life? I’d have thought Cerberus would have gotten rid of that stuff, but no. There is someone I know who was a director who got his new car this year. You think the gov’t is going to change that policy now that we own it? I wonder how many other “traditional” perks that were waaaay too common in Detroit and not the rest of the world are still being given to retired execs and board members?

When life gives you lemons, you make lemonade (or glazed strawberry lemon streusel muffins). When Chrysler gives you lemons, you’re SOL. Since April 30, Judge Arthur Gonzales has to approve payment on claims against Chrysler incurred before C11. That includes “lemon law” settlement checks to customers who bought defective Dodge, Chrysler or Jeep products. Not happening. “San Diego attorney Ellen Turnage represents a client who reached a settlement with Chrysler over a 2006 Dodge Magnum with a bad suspension. The car has been returned to Chrysler, but the automaker’s check bounced. ‘Now he’s got no car and no money, so he can’t go buy a new one,’ Turnage said of her client. ‘He’s stuck. We’re hanging on to a glimmer of hope that at some point this will all be resolved.'” As the LA Times reports, Turnage’s pessimism is well-justified. Instead of saying, sorry, we’ll expedite this, the new Chrysler is telling aggrieved customers to FO&D.

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The US Treasury Secretary had a little chin wag with Reuters re: GM. It seem that Mr. Geithner is as pleased as punch with his minions’ work with Chrysler’s bankruptcy. So pleased, in fact, he sees ChryCo’s dissolution solution as a template for GM’s C11. You know “if”. “There is a range of ways to achieve [GM’s restructuring]. You saw what we did in the Chrysler context as one way to do it and if that proves necessary in the GM context, we’ll do that.” And then the aforementioned “if”. “But we’re not at the point where we need to make that judgment yet.” Sure. They’ve got 28 days to convince GM’s bondholders—a motley crew of “investors” looking at differing payout and maturity dates—to take a flyer on a company that hasn’t made a profit for . . . sorry, debt for equity swap. And here’s some fuel for those who see the government’s role in the US auto industry as reprehensible.

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A TTAC source has pinged us: “‘I’ve just heard 2nd hand that the Delphi OnStar team has had all their GM contracts canceled. It seems that GM may be getting rid of OnStar completely, but it isn’t clear when that would happen. This sounds like a pretty good business decision to me since cell phones have become so widely adopted, and navigation systems are getting cheaper.” This tip flies in the face of a recent Reuters report, in which the head of said OnStar claimed the service was wildly profitable. OK, “highly.” Which is the same as “wildly,” given GM’s current slide into C11. Anyway, “GM does not break out its revenue or profits from OnStar, but had said the division had turned profitable in 2003 and has been steadily and more profitable since. The division receives part of its revenues from consumer subscription fees.” One possible explanation (just in): GM is simply “de-sourcing” Delphi as OnStar supplier, as it prepares to deep-six the bankrupt parts-maker’s contracts. Or something. But wait! More tipster action from an ex-OnStar employee after the jump.

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Commentator David Dennis asks…

I hope I’m not changing the subject too much, but there’s one thing that’s really bugged me about TTAC: your dislike of “Maximum Bob” Lutz. I may have read too many buff books, but I’ve always instinctively liked the guy.

I can’t help but notice that Chrysler had a pretty good car lineup when Bob jumped ship for GM. Once Bob was gone, their new car lineup disintegrated into the awfulness that has them in their current pathetic condition.

And likewise, once Bob started at GM, GM cars started getting a lot better, to the point where TTAC and other reviewers noticed.

Is Bob Lutz a great man or an out of touch domestic automaker drone? It seems to me that he’s pretty good at product development, or at least at convincing companies to approve better and more adventurous ideas already percolating.

I know he makes some outrageous comments but sometimes there’s a lot of truth to them, too.

Thoughts?

D

The Motor Authority reveals that Cadillac has spiked the STS-V model for 2010. The high-performance variant of the brand’s slow-selling flagship (who knew?) joins the Impala SS, Cobalt SS and Pontiac G6 GXP in model heaven (purgatory?). The SS moniker will live in in the hearts and minds of students of Jewish persecution and fans of the new Chevrolet Camaro. As widely reported elsewhere, GM CEO Fritz Wagoner Clone Henderson specifically highlighted the fact that GM was NOT going to drop the Corvette from its shrinking roster of performance-oriented brands—I mean, products. This despite slow sales, a ruling Presidential Task Force on Autos that keeps mentioning the words “small” and “fuel efficient” (yes, I know), and the fact that the in-house fanzine “Corvette Quarterly” has published its last paean to pistonhead perfection, or a reasonable facsimile thereof.

Detroit apologists—who sincerely believe that GM was headed for turnaround town when gas prices ascended and the worldwide economic tsunami hit—will take pleasure in the fact that Toyota reckons it’ll spill $8.6 billion worth of red ink on the corporate carpet. No doubt, the Japanese automaker is “struggling” to cope with the loss of one million units from their worldwide balance sheet. During the January to March Japanese fourth quarter, the formerly unassailable automaker got assailed but good, losing $6.9 billion. As we’ve reported previously, the US and Japanese markets are ToMoCo’s big hole, switching from huge profits to equally enormous losses without much of anything in between. As Automotive News [sub] reports, the head of the ailing automaker had  a completely different response to the news of his employer’s sinking fortunes than, say, anyone who works for GM. [GM cheat sheet: the secret word is “accountability”.] “Of course the external environment doesn’t help,” Toyota president Katsuaki Watanabe told reporters. “But we were lacking in the scope and speed of dealing with various problems and issues, and for that I am sorry.” So . . . now what?

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Reuters reports that gunmen shot and killed a union leader at Toyota Motor Corp.’s Venezuelan unit on Tuesday, a few weeks after the Japanese automaker said it might leave the country because of chronic labor problems. “Labor disputes and strikes have become frequent in Venezuela. In January, two workers were shot to death as police broke up a protest at a vehicle assembly plant for Japan’s Mitsubishi Motors Corp. and South Korea’s Hyundai Motor Co.”

“Off-roaders are only suitable for terrain; compact means sacrifice and sports cars only appeal to contortionists who have no spine: once prejudices were easier and the choice of the right car was therefore complicated. Who would have thought that the Mercedes GLK would one day turn all these clichés on their head and flirt with an attractive optical package from Sportservice Lorinser?”

Not me.

TTAC’s very own David Holzman writes:

How high could a Prius or Insight climb before the battery would run so low as to cease contributing to horsepower? In other words, If I lived at the top of Skyline Drive and worked in Palo Alto (or had a similar commute somewhere else), would the electric boost cut out on the way home? How much elevation could either car cope with? And once the battery has bottomed out, how weak is the car going to feel? I’m guessing not nearly as bad as my then-8-year-old ’62 Falcon, which I could barely push over 30 in second, climbing the mountains in Wyoming, Utah, Nevada, and California. Still, would someone with this sort of commute want to avoid a hybrid?

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We’ve received this heads-up letter to GM dealers from one our sources on the front line. [thanks to you-know-who-you-are]:

IMPORTANT BULLETIN: Parts Order Management Update

Paul Copses, Executive Director — GM SPO Sales and Marketing, and Charlie Hyndman, Executive Director– GM SPO Global Warehousing and Operations

05/06/2009

To: All ACDelco Customers, GM Dealers and Saturn Retailers (US, Canada, Mexico, Middle East, Other)

Please be advised that GM Service and Parts Operations have been working on supply plans for all of our suppliers over the past few months to ensure adequate inventories of service parts for our customers. However, in order to carefully manage inventories for our key supplier, Delphi, it is necessary to take some near-term actions.

Well, that’s one way to avoid the US government’s $500K CEO salary cap for companies receiving bounteous billions of federal largesse. A Fiat spokesman confirmed Fiat CEO Sergio Marchionne’s ascendency [via The Detroit News] and our theory that saving the US auto industry by surrendering it to Italian control (of all things) is a prime example of off-the-charts political expediency. Given the non-TARPies debt holders’ surrender and Marchionne’s “appointment,” the question now becomes, can he actually do this thing? TTAC commentator PCH101 reckons Sergio’s got the turnaround chops for the gig but may not have a handle on American tastes. Howard Wheeldon clocks the German part of the program and compares bite marks to chewing ability. “In a way all of this has come a little bit too fast,” worries the senior strategist at BGC Partners. “One would like to see two or three years of really strong results in Europe and in Italy for Fiat before they delve out this far and fast. I am extremely worried about this German thing and their wanting to become No. 2 in the world. It will end in tears.”

The day after they were “outed” by a federal bankruptcy judge’s fiat, Chrysler’s holdout debt holders have thrown in the proverbial towel. And whom do the non-TARPies blame for their recalcitrance and capitulation. Lawyers White & Case said their clients withdrew for “various reasons . . . as a consequence of concerns stemming from publicity of these Chapter 11 cases.” In other words, they were intimidated! This despite the fact that they were unable to prove their claim that they’d been subject to death threats for their reluctance to take the government’s debt-for-equity swap—other than a few comments posted on a website (go internet!). And while they were at it, the non-TARPies’ brief cleared-up the question plaguing financially savvy conspiracy theorists everywhere. The law firm said none of their clients hold credit default swaps, which would have paid off their entire holdings if the judge had ordered a Chrysler liquidation. (Doh!) The White House said “whew!” “While there is still a lot of work to do, this development gives us further confidence that Chrysler’s bankruptcy will be quick and orderly,” White House spokesman, Robert Gibbs, elucidated.

GM is auguring-in for its date with a bankruptcy judge, burning [your] cash, shedding share and losing money as it goes. The latest ding: the company reports that it’s lost $6 billion in the first financial quarter. That’s almost double last year’s Q1 results ($3.3 billion). Revenues sank 47 percent ($22.4 billion from $42.4 billion). As always, there’s a lot of waffle in the official press release: “GM’s automotive results in the first quarter of 2009 were driven by a revenue decline in all regions, due in part [in part?] to a depressed global industry. In addition, GM’s results were impacted by unfavorable foreign currency exchange and mark-to-market commodity hedging versus the year-ago quarter. However, these losses were partially offset by a significant structural cost improvement of $3.1 billion when compared to the first quarter of 2008.” But the bottom line is clear: the federally-funded automaker’s house is on fire and so far from profitable it’s not even in the same solar system. GM CEO Fritz “Wagoner Clone” Henderson reckons he knows how to plot a course for the Milky Way.

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Why did Maybach put a speedometer in the rear of the cabin? The salesman’s line: “so you can tell the driver to slow down.” I don’t think so. Plutocrats don’t get to be plutocrats by ambling about, caring about the hired help’s driving record or hiring chauffeurs who can’t drive safely. [NB: Mohammed Al Fayed wasn’t a plutocrat.] My explanation: velocity equals distance over time. Maybach figured its patrons would want to note their speed, check the flanking clock and calculate when they’d get to where they’re going. In other other words, Maybach owners would want to know when they’re going to leave their Maybach. The roof-mounted speedo embodies the luxury limo’s underlying philosophy. Maybach. The ideal conveyance for people who’d rather be somewhere else.