The NYTWheels blog reports that Judge Arthur Gonzalez has overruled pleas by consumer advocates and law professors by granting Chrysler’s request to exempt “New Chrysler” from any liability arising from “Old Chrysler.” Public Citizen, the Center for Auto Safety and Consumers for Auto Reliability and Safety have formally objected to the move on the grounds that current owners of Chrysler vehicles will have no legal recourse if they are injured because of a product defect. A lawyer representing these groups has said they will seek an appeal, the second objection to date to the Chrysler asset sale. According to testimony by Robert Nardelli, the idea of not allowing current owners to sue came up during the discussions between the Treasury and Fiat. Unlike the State of Indiana’s appeal of the Chrysler asset sale, this appeal has the potential to completely change the incentives for Fiat to take over Chrysler. If an appeals judge hears and approves this objection, Fiat could simply walk away.
Well, that’s how the Freep puts it. So will GM be leaving the toilet seat down? Will it apply for a separate credit card to pay for its extramarital liaisons? Will it be hiding its Playboy inside the latest Economist? Want to clear this up for us, CFO Ray Young? “As a privately held company, it’s likely we’re not going to disclose information except to the shareholders,” says Young. “We do not have to file all of the same documents that we do when we are a public company,” clarifies Chairman Kent Kresa. All of which creates more mind-benders than Will Shortz on a weeklong acid bender.
Chalk up another reason why Chrysler should have been allowed to fail. The New York Times reports that if Chrysler’s restructuring is approved it would allow the automaker to evade liability for injury-causing defects on its vehicles. An Automotive News [sub] write-up of Chrysler’s creditors reveals that the Ad Hoc Committee of Consumer-Victims of Chrysler LLC consists of 150 members seeking an estimated $650 million in damages allegedly caused by Chrysler vehicle defects. Under current reorganization plans, those creditors would be left with no recourse after Fiat assumes “good Chrysler’s” assets.
Toyota’s third-generation Prius hybrid launches in Japan on Monday, with a European rollout scheduled for July, and already they firm has amassed 75k pre-orders worldwide. Of course, Toyota won’t confirm the number, which originated in a Nikkei report printed in Automotive News [sub]. Honda’s Insight has already become Japan’s top-selling car, the first hybrid to hold such a title. And all this despite oil and gas prices that are significantly weaker than a year ago. But, as GM is currently proving, pre-orders can sometimes be more trouble than they’re worth.
The thesis that name and form are inseparable, a truth endorsed by both the Theravedan Bhuddist text Visuddhi-Magga and Paul Niedermeyer, has found new support in the recently-released Polk Loyalty Study (PDF) (via PR Newswire). Studying brand repurchase and defection rates in Q1 2008, Polk and Co found that 55 percent of owners whose model was discontinued prior to re-entering the market defected to another brand. That compares to 47 percent defection for owners of non-discontinued models from the same brand. The elder Niedermeyer was particularly prescient in pointing out how this dynamic has hurt GM in particular, thanks to its pathological renaming of mid-sized and smaller offerings. This “same name dividend” is as high as 12.7 percent for compact cars according to the report, but fades to a “negligible impact” for large cars and pickups. The Cavalier to Cobalt transition in specific is said by the report to have cost GM “millions in potential sales.”
The question that has haunted the very soul humanity for eons—“that thing gotta hemi?”—should hopefully drift out of the vernacular, as ChryCo is offering free Hemi V8 upgrades on every Ram 1500 they sell during “shovel ’em out the door,” uh, make that “truck month.” So yes, good sir, it’s got a Hemi. But as Wikipedia puts it, “today, ‘hemi’ is little more than a trademark that bears little meaning, descriptively, for the engines designated as such.”
The surprising answer, via Consumerist, is nothing. Well, sales-wise. Richard of tryingtostimulate.wordpress.com (the economy, you perv) built out a Jeep Wrangler online, and was quoted a price of $24k. Thinking that giving an American automaker some business would be as easy as showing up, writing a check and driving away, he visited not one, but two Jeep dealers. Both tried desperately to get him to finance (so much for shoring up cashflow) and neither would sell him the vehicle he “built” online. In short, the man wanted a Jeep and had cash, but Chrysler’s crack (smoking) dealers couldn’t make it happen. Maybe they need a few more bailouts before they’ll start accepting cash for their products.
GM recently settled an SEC investigation into its accounting practices. The automaker didn’t admit guilt or pay a fine, but it was confirmation– if confirmation was needed– that GM under Rick Wagoner has played fast and loose with the numbers. And when you’re as big as GM, little “tweaks” here and there can have a significant effect on the bottom line. In fact, I’d go as far as to say that history will eventually regard Wagoner as an accountant gone wrong: a GM lifer whose only genius lay in his ability to make numbers his bitch. Until he couldn’t. As part of that legacy, this [press release after the jump]. I’m no lawyer, but it appears that GM violated rules regarding mark-ups to dealers and, thus, customers. And once again, the “winners” of a legal action against an automaker get discounts on the offending company’s products, while the lawyers get millions of dollars. Not to coin a phrase, but how great is that?
Automotive News [sub] reports that J.D. Power is introducing a Vehicle Launch Index, aimed at providing OEMs with data and feedback on product launches. For a nominal (sliding scale) fee, JDP will follow launches for the first 12 months of a model’s life, measuring ad effectiveness, consumer response, dealer gross profits and incentive spending. “There will be 88 new and restyled model launches in 2009,” JDP VP for research Dave Sargent tells AN. “Some of them will succeed. Others won’t, and frankly should never have gotten approval to see the light of day.” And JDP’s role will be to boldly proclaim vehicle program flaws during and after launches, because “it’s hard for people inside the company, especially if they want to get ahead in their career, to derail a project by saying, ‘This plan is flawed.'” Because what fixes dysfunctional product development like a highly paid consultant offering post-mortem bon mots?
…You know you’re in some trouble. The AP reports that local governments are adopting the kaizen principles that launched Toyota to the production efficiency monster it is today. And the bureaucratic nightmares which once defined government inefficiency are being massively reduced. For those who are not familiar with “the five whys,” the AP describes kaizen as “a way of thinking that diagrams a job step by step, puts workers at the center, gives them a sense of the total process they’re involved in, and then frees them to think of ways to best do their jobs.” Or, as the quality services director at the Ohio Department of Administrative Services puts it,”You cannot filibuster, you cannot stall. You look at this thing and say ‘OK, justify that.'” The concept has become the hot thing in local government the nation over. As one strangely-picked example goes, the average time to process death certificates in Maine recently dropped from 95 days to five after the state introduced kaizen principles. “We got calls from people saying they want to die in Maine now because they can get the death records so quickly,” claims a Maine HHS honcho. Any of those calls come from Detroit?
…and Honda tops the list for the first time. Nearly 65 percent of new Honda purchases replace an older Honda, edging Toyota’s retention rate by 1.5 percent. Lexus comes in third with 60.4 percent retention, followed by Mercedes and BMW. Ford scored the highest of all domestic brands, capturing 6th place with 52.5 percent retention and barely edging Chevrolet which boasts an even 52 percent retention. Cadillac was the only other domestic brand coming in above the industry average of 48 percent. Jaguar scored the lowest in the survey, with only 26.2 percent retention. Pontiac was second to last with 27.2 percent, with only Mitsubishi and MINI joining it under 30 percent. Check out the full results in PDF form at JD Power’s site.
In honor of the imminent celebrations, Consumer Reports has picked its “Automotive Turkeys” of 2008, and they got some good ones. Tax credits for Hybrid Tahoes, Chrysler’s four-week Aspen/Durango Hybrid reign of terror, Acura’s styling, the Smart’s pricing and much more get the thumbs down from CR’s Mike Quincy. In advance of TTAC’s Ten Worst awards, I’m asking: what makes your list of automotive blunders for 2008? Personally, the Volt transformation, the bailout beggary and Chrysler’s Project D(isaster) would be near the top of my list. Yours?
Poor Mark LaNeve. It’s bad enough that he’s gonna be fired soon for having overseen some of the worst sales declines in GM history, including a 45 percent plummet last month. Now, those twisted bastards over at Toyota won’t even let him enjoy a freaking football game without publicly humiliating and annoying him with those damned “saved by zero” ads. Luckily, LaNeve always has a sympathetic ear over at the Detroit News. Or six. No fewer than three scribes get credit for giving voice to LaNeve’s tortured soul in a terse paragraph that tugs at the funnybone heartstrings. “I’m a football fan,” LaNeve told DetN during the weekly GM sales call. “I saw (“saved by zero” ads) 52,000 times,” he reportedly “moaned” of his Sunday otherwise well spent. Well, I guess you gotta say something during those sales calls. Y’know, once you get past the “we’re down 45 percent” bit. (Warning, Video NSFS (Not Safe For Sanity))
First we had Forbes’ columnist Jerry Flint bellowing (meekly) “Remember the Maine!” Now we’ve got Automotive News‘ [AN, sub] engineering beat reporter Richard Truett defending Detroit in that scary ass demented stalker fan club president sort of way. “Here’s what I find especially disturbing: Whenever there’s a story about one of the Detroit automakers on a Web site that allows readers to comment at the end of the article, you can count on loads of vile bile from respondents who can’t wait for GM, Ford and Chrysler to go out of business. For the most part, these are angry people. But… I wonder: How long does GM have to be punished for making Chevrolet Vegas and Oldsmobile diesels or relying too long on the fat profits of trucks and SUVs? When does Ford get forgiven for the Pinto and other crimes against auto mobility? When will Chrysler be let off the hook for making everything out of the K car and for the rotten minivan transmissions in the early 1990s. When will people — environmentalists, especially — chastise Toyota for making its share of gas-guzzling behemoths? WHY CAN’T YOU JUST LEAVE BRITNEY ALONE?” I added that last bit, obviously. Anyway, there’s more after you click on that “more” button below
As promised, we’ve switched TTAC’s layout from all reviews in the left hand column, to every thing we do in chronological order in the left hand column. We made the move because TTAC has evolved from a review only site, to a review and rant extravaganza, to a review, rant and blog farrago. We altered the layout (a retro-mod for those who can remember back six years) because the old format didn’t offer immediate visual evidence that we’re generating masses of new content. In addition, we’ve finally added proper photo galleries (working with it now), which will give pistonheads another excellent reason not to waste their time visiting our competitors. We’ve also reinstated product reviews. And added a stock tracker (suggestions for which stocks to follow would be most appreciated). The nav buttons at the top of the home page should help you find everything, or you can scan the menus on the right hand side. There will be a few more tweakettes in the hours to come, but them’s the basics. Feel free to share your feedback, but we’ve blown the development budget; any appropriate suggestions for improvement will have to wait until the next round. Meanwhile, TTAC’s content itself remains as is: irreverent, cocky, abrasive and honest. I hope you enjoy the new look and functionality.
…You know you’re in some trouble. 
…and Honda tops the list for the first time. Nearly 65 percent of new Honda purchases replace an older Honda, edging Toyota’s retention rate by 1.5 percent. Lexus comes in third with 60.4 percent retention, followed by Mercedes and BMW. Ford scored the highest of all domestic brands, capturing 6th place with 52.5 percent retention and barely edging Chevrolet which boasts an even 52 percent retention. Cadillac was the only other domestic brand coming in above the industry average of 48 percent. Jaguar scored the lowest in the survey, with only 26.2 percent retention. Pontiac was second to last with 27.2 percent, with only Mitsubishi and MINI joining it under 30 percent. Check out the full results in PDF form at 
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