The mainstream media’s big story of the day is Toyota’s “sticky pedal” strategy in the courtrooms across the land. And it has little or nothing to do with actual gas pedals, and everything to do with stalling in producing the court ordered company documents that could show known deficiencies in product design and safety. AP analyzed lawsuits covering a range of complaints, and in response to requests for company documents, Toyota has consistently claimed it does not have them, or simply ignored court orders to produce the documents. The pattern being uncovered supports the claims made by Dimitros Biller, a former Toyota attorney who sued (and settled) with Toyota after contending that the company deliberately withheld evidence in older rollover cases. Read More >
Toyota is still smarting from a heavy decking it has received from Congress, the NHTSA, lawyers, and the press. Toyota’s answer? Let’s get SMART! Read More >
No big deal in China is done until it’s signed and sealed – by the Chinese government. In the case of Volvo, there won’t be any Hummeresque killing me softly. Geely’s deal to buy Volvo from Ford, reached last month, will be waved through the (necessary) approval process. Read More >
NHTSA’s head of Defect Investigation will step down, according to the Wall Street Journal [sub]. Kathleen DeMeter has been with NHTSA for 30 years and spent 15 years in her current position. According to DOT officials, DeMeter “delayed her retirement in order to assist the agency during the recent Toyota recall crisis,” but at 60 years of age, it’s just as likely that she is NHTSA’s first casualty of the Toyota investigation fallout. After all, the Secretary doesn’t like having to explain to congress why his investigators only have two electrical engineers. An interim head of Defect Investigation will be named, while NHTSA searches for a permanent replacement… who wants to bet it’s going to be an engineer?
Thus far, Transportation Secretary Ray LaHood’s war on distracted driving has been largely a rhetorical hobbyhorse, giving the good Secretary a crowd-pleasing speech topic no matter where he finds himself. After calling the situation “an epidemic,” LaHood held a summit at which it was agreed that distracted driving is bad, especially when it causes deaths. Federal employees were subsequently barred from texting while driving government-owned vehicles during work hours. And that was just about it. Apparently chastened by his big build-up and lack of pay-off on this issue, LaHood has kept himself busy with the Toyota debacle of late, leaving distracted driving largely alone since last summer’s summit. Until he remembered that there was one crucial tool in his bureaucratic bag of tricks that he hadn’t yet used: the photo op.
China’s carmakers better get their pure plug-ins ready. The central government is set to spend serious money to electrify development and sales. China Daily reports that “a much-awaited government stimulus plan” is ready for government approval and should be in effect in the next couple of months.
Private buyers in five chosen cities (so far unveiled, but the usual suspects apply) will be able to collect close to $9000 if they buy a pure plug-in. Imports need not apply. Read More >
During the courtship stage between Geely and Volvo, and after their recent nuptials in Gothenburg, Sweden, we often raised the matter of Chang’an. Chang’an has had a joint venture with Ford since 2001. Under the JV, they also make Volvos in China, the S40 and S80, to be exact. They don’t make them in large numbers. 22,405 Volvos were sold in China last year, up nearly 80 percent compared to 2008. The S40 has been on the Chinese market since 2006. The S80L, a long version of the S80, was introduced last year. Chang’an had been in play as a suitor for Volvo, but bowed out.
What will happen to Chang’an’s Volvos? Read More >
My first day back at the helm of TTAC has been accompanied by an embarrassment of riches, in the form of both a GAO report on GM and Chrysler’s pension obligations, and the release of GM’s first post-bankruptcy, GAAP-approved financial results. We will continue to mine these documents for the most revealing quotes and statistics, but for now let’s take a moment to consider the political tensions caused by the auto industry bailout. TTAC has long held that political conflicts over the government’s stewardship of GM and Chrysler is a pressing concern, nearly on par with the financial ramifications of the auto bailout, and today’s GAO report confirms our concerns. As the following quote reveals, Treasury is under constant pressure to accommodate political concerns over the management of its stakes in GM and Chrysler, and has received no fewer than 300 official letters from congressional representatives, eager to subordinate the long-term health of the bailed-out automakers to their local concerns.
It would be impossible to blame Detroit’s decades-long decline on a single factor, but if one were to make a list, defined pension obligations to workers would be somewhere very near the top. Thanks in large part to the unionization of America’s auto industry, Detroit has groaned under the weight of crushing pension obligations since time immemorial. And, according to a new report by the Goveernment Accountability Office [full report in PDF format available here], last year’s bailout of GM and Chrysler has not eliminated the existential threat that these obligations pose to the industry. In fact, the taxpayer’s “investment” in GM and Chrysler appears only to have exposed the public to even an greater risk of catastrophic pension plan failure.
A committee of the California General Assembly last month began consideration of legislation that would make minor changes in the way red light cameras are used in the state. State Senator Joe Simitian (D-Palo Alto) introduced a bill that he believes will increase the fairness in the administration of automated citations. Simitian is a supporter of photo ticketing who nevertheless believes the existing system suffers from significant flaws.
Last evening, U.S. Transportation Secretary Ray LaHood declared he’d be seeking the maximum penalty from Toyota. That’s $16.4m, because “they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families.” That’s the largest civil penalty the U.S. Department of Transportation has ever sought. According to Reuters, “previously, the largest fine was $1 million against General Motors Co for failing to promptly recall windshield wipers in 2002-2003 model vehicles.” One would think Toyota can pay that out of petty cash. But the matter has Toyota concerned. Plaintiff lawyers are rubbing their hands. Read More >
A Florida state representative is standing athwart the legislative juggernaut that seeks to expand the use of red light cameras throughout the state. Representative Rob Schenck (R-Spring Hill) last month won approval by a 7 to 5 vote from the House Governmental Affairs Policy Committee for his bill expressly preempting the ability of local jurisdictions to operate automated ticketing machines.
On April 1, new federal fuel economy CAFE standards went into effect. By 2016, new cars should get 35 mpg or thereabouts. The true number remains an exercise in abstract algebra. Says Consumer Reports: “The new standards require different fuel economy averages for each manufacturer and for each type of vehicle (such as small, midsized, and large sedans or SUVs).” There are plenty of loopholes and offsets. Extra credit for cars that take E85 Ethanol, for instance. And here is another huge loophole: Read More >
A few days ago, we reported that Toyota had caved in to demands of the Commerce Bureau and the Consumer Protection Committee of China’s Zhejiang Province. Under the agreement, Toyota will reimburse Zhejiang customers for losses sustained from the RAV4 recall. Toyota will send people to pick up and deliver the affected vehicles, and will provide a loaner while the car is in the shop. The whole thing was started by New York’s AG Andrew Cuomo who strong-armed Toyota into supplying similar services to recall-affected residents of the Empire State. The Zhejiang-accord had The Nikkei [sub] worried: “Such an agreement could lead to demands for similar deals from customers in not only other provinces, but also other countries.” It didn’t take long. Read More >
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