In prepared testimony before the House Judiciary Subcommittee, Car Czarlet Ron Bloom revealed that the government would no longer back GM and Chrysler warranties. “With the successful emergence of the new companies, consumers can now feel assured that the companies have the financial wherewithal to meet their warranty commitments on a continuing basis,” Bloom said. The $641 million spent by the government on the warranty program has been returned to the Treasury with interest, reveals Bloom. “This achievement represented a prudent short-term use of taxpayer funds,” was his conclusion. GM spokesfolks tell Automotive News [sub] that The General never even tapped the fund, while Chrysler reps are mum on the subject.

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An Automotive News [sub] piece on Toyota’s efforts to rethink its North American manufacturing strategy reveals Toyota NA President Yoshimi Inaba’s potential willingness to apply for US retooling loans. Though Inaba states that the Obama administration would not play a “material” role in Toyota’s return to profitability, he refused to rule out applying for Department of Energy retooling loans. Nissan has already secured $1.6b worth of the so-called “136 loans,” and is moving away from its current strategy of sourcing hybrid components from Toyota, according to Reuters. And whether it takes money from the government or not, Toyota is sounding the same PR notes as its recently-rescued competitors. “Our sense has been always that we listen to the market, we listen to customers, we listen to the dealer. That element is a little bit lost,” admits Inaba in the WSJ. Inaba also concedes that Ford is better positioned to exploit GM and Chrysler’s bankruptcy-bailouts, adding that “we certainly want a good chunk of it. As the dust settles down a little bit we would also like to go after any incremental volume.”

Facing a House vote tomorrow on legislation that would repeal GM and Chrysler’s dealer cuts, President Obama is urging congress to not interfere with his auto industry restructuring. Automotive News [sub] quotes an Obama statement calling the cull “a critical part of their overall restructuring to achieve long-term viability.” The Obama statement alleges that “it would set a dangerous precedent, potentially raising legal concerns, to intervene into a closed judicial bankruptcy proceeding on behalf of one particular group at this point.” Because intervention on behalf of one particular group may only be done during a bankruptcy, by the government. Rep Steven Latourette, one of the bill’s sponsors, predicted that his legislation would pass the House “by a wide margin.”

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GM Bankruptcy lawyer Harvey Miller confirms what Steve Rattner’s departure from the Presidential Task Force On Autos suggested, telling Bloomberg “I really believe that by the end of August, the task force will be gone.” Miller explains that “the winding down of Old GM and Old Chrysler will take a significant period of time, but it will not involve anything like the task force. It will be an ordinary liquidating bankruptcy.” Rather than the bankruptcy code-shredding process that recently wrapped up. The credit market is going to take it from here. “I’ve been around a long time in this business and I’ve heard financial institutions say, ‘We will never lend another penny to this industry’ on the basis of this decision in bankruptcy court or elsewhere,” says Miller. “Three or four months later, they’ve totally forgotten. There is no institutional memory in this world.” At least the last part of that is dead on. The rest? Perhaps a tad optimistic. Most likely, some form of government guarantees will be necessary to convince banks that GM is creditworthy. Otherwise, its $50b debt load to the taxpayers and internal turmoil make it a poor target for private investment. But, hey, why not give it a whirl?

From Reuters comes word that Car Czarlet Steven Rattner will be leaving the Presidential Task Force On Autos. The move “represents the start of a long-planned wind down of the autos panel” according to Reuters’ interpretation of an anonymous White House source. “With GM’s restructuring complete, Steven Rattner, whose leadership and vision were invaluable to the Auto Task Force’s efforts, has decided to transition back to private life and his family in New York City,” explains a statement from Treasury Secretary Timothy Geithner. “We are extremely grateful to Steve for his efforts in helping to strengthen GM and Chrysler, recapitalize GMAC, and support the American auto industry. I hope that he takes another opportunity to bring his unique skills to government service in the future.” Unique skills? Is Rattner getting blown off or is this Mission Accomplished? A little of both?

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Consumers have a hard enough time keeping all the brands and nameplates in the US market straight; trying to keep track of the myriad suppliers that make up the bulk of the industry is nearly impossible. Even here on TTAC, our well-informed commentariat often throws up its hands at the first sign of supplier coverage. But the fortunes of suppliers to US auto firms have been fading for years now, as Detroit’s misery slides downhill through the various tiers of suppliers. And despite repeated calls for a supplier bailout (and their use as OEM bailout bait), aid has been either misappropriated or rejected. And the bankruptcies show no signs of slowing.

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We keep racking and stacking the Bailout Watches and Uncle Sam keeps the federal funds flowing. As Eddy reported before the weekend, Congress is looking to send another $25 billion to the Department of Energy to bless upon car companies re-tooling old factories to build more fuel-efficient products. In the form of loans, of course. Twenty-five-year loans. The funds are buried inside the 1200-page American Clean Energy and Security Act of 2009 (a.k.a. climate change bill), currently earmarked for Senate debate (so to speak). Whatever. The new funds will bring the total auto industry bailout ever-closer to the $200 billion mark. Anyway, should the legislation pass muster, the entire electric vehicle industry—from manufacturers to fleet buyers—will feel the love. Click here for the relevant text.

Despite the backbiting and overextension engendered by round one of the Department of Energy’s retooling loans, another $25 billion could be headed down the pipe. Automotive News [sub] reports that a second dose of retooling loans (the first having launched our Bailout Watch series) is headed towards a vote this weekend. The DOE’s loan budget would be doubled under the current climate change bill sponsored by Reps Henry Waxman (D-CA) and Ed Markey (D-MA). But before Ford starts counting its (non-bailout) chickens, remember this: “no comparable bill has been introduced in the Senate, and similar legislation was shot down in the Senate last year.” And with luxury firms (Tesla), foreign transplants (Nissan) and the proudly bailout-free (Ford) topping the list of tranche un, don’t expect a groundswell of support for tranche deux.

Manny Lopez has a cow about Tesla’s $465 million Department of Energy loan over at the Detroit News, concluding that tax dollars shouldn’t “be spent, propping up millionaires and billionaires, who, unlike their Detroit CEO brethren, fly in private planes when they’re not toying around town in their electric cars.” And why is it that Detroit’s CEOs don’t fly on corporate jets? Oh, right. Sweet Pete DeLorenzo lays into Tesla as well, saying it got the loans “so that it can become a real car company instead of a boondoggle that makes outrageously overpriced battery-eating kit cars.” MLive‘s Rick Haglund even figures Elon Musk’s divorce-by-blog reflects an unseriousness that makes his firm undeserving of taxpayer support.

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GM spokesfolks confirm to Automotive News [sub] that the deadline to submit bids for the General Motors asset sale has passed. And surprise! Nobody has taken on the Treasury in the 363 sale’s bidding process. Sorry, America. But AP Services LLC, an affiliate of AlixPartners is having its $58.9 million in fees contested by the US Bankruptcy Trustee. In addition to a $20 million retainer and $16 million for services provided in May, AP Services stands to receive another $13 million upon the completion of the Section 363 sale. As RF’s General Motors Zombie Watch 7 reports, the consulting firm also “seeks a discretionary fee of an unknown but potentially unlimited amount that will be determined” at the sole discretion of GM. The US Trustee is also objecting to the $46.6 million in fees paid to Evercore Group LLC, another GM restructuring consultant.

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A cash-for-clunker bill, “stripped down” to $1 billion, has passed the Senate. Automotive News [sub] reports that the new bill will go into effect one month after it is signed by the president and will offer $3,500-$4,500 rebates only through November. The spending cap had been set previously at $4 billion. Sen. Judd Gregg [R-NH] led an attempt to strip the provision from an Iraq funding bill that was voted down along party lines. Meanwhile, the AP bemoans the “flagging clout” of the auto industry. And Autocar points out that total European car sales across all brands were down 4.9 percent compared to May 2008. Yes, the much-vaunted European scrappage schemes helped . . . Hyundai (+25.1 percent), Suzuki (+3 percent), VW (+3 percent) and Fiat (+2 percent). Everyone else . . . not so much.

TTAC reader and marketing consultant John Charles of Stockholm, Sweden, was gracious enough to send us some more info on investor Mark Bishop, the man who would be king of Saab.

Hi, I read your very interesting piece on Mark Bishop and SAAB. However you (unintentionally, I imagine) missed out a few details. I have found out that Bishop was involved as President of the rather shady Quick Loan Funding. It is understandable that Bishop chooses not to mention his time at QLF in his CV.

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File this one under “You’re Talking a Lot, But You’re Not Saying Anything.” The Detroit News‘ “wide ranging” interview Presidential Task Force on Automobiles (PTFOA) jefe Steve Rattner’s ranges entirely over well-trodden ground. In fact, you’ve got to give the DetN credit for publishing an entire pow-wow with the man behind the meltdown without revealing a GD thing. Well, other than the between the lines stuff. Like the “I’m a car guy now” subtext to this lump of coal: “We found that the game plan that we had designed back in the March time period actually worked,” “Chooch” Rattner told the Detroit News. “It’s like you build a new car and you take it out and you test drive it and it actually works. It made us feel pretty good going into GM — even though we know GM is bigger and more complicated — that we should be able to accomplish a similar result albeit over a slightly longer period of time.” I like that sense of surprise: this thing actually works! Wing and a prayer GM engineering at its best. Anyway, more . . .

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After my Wall Street Journal Op-Ed gave Massachusetts Congressman Barney Frank serious shit for personally intervening with GM’s turnaround plans—to save a parts distribution warehouse in his district—the WSJ has gone on the attack. OK, sure, they would have done it anyway. It probably had nothing to do with me whatsoever. Anyway, personal ego issues aside, the WSJ‘s forced Barney to explain his influence-peddling. Apparently, it was OK for the TARP-meister to ring-up GM CEO Fritz Henderson and ask (demand?) for the Norton facility to remain open because . . . it’s not a factory or a dealership. The headline above offers the politician’s distinction. Which begs a number of questions: how is a parts distribution center environmentally friendly? Does he seriously expect us to believe that he acted to save the planet? And if he can mess with GM, what’s to stop his colleagues?

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