In a conversation with The WSJ [sub]’s Paul Ingrassia, former Car Czar Steve “Chooch” Rattner did some “back-of-the-envelope calculation” to show why he believes the US taxpayers will see their $50b “investment” in GM recouped when The General goes public sometime in the next year.

Here’s how Rattner gets to his latest calculation: Bonds of GM’s bankruptcy estate – known as Motors Liquidation – are currently trading around 30 cents on the dollar, according to Thomson Reuters. Those bondholders were owed $27 billion.

As part of GM’s restructuring, those bondholders were promised a 10% stake in GM when it goes public. In very rough calculations, those bonds are currently valued at about $9 billion (because they currently trade at around 30 cents and were originally worth $27 billion).

Assuming that $9 billion represented 10% of GM if it went public now that would imply GM had a value of around $90 billion. The taxpayer’s stake: 60% of that $90 billion, or $54 billion — Rattner’s magic number.

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As an American citizen, it is tough on my part to pay tax dollars to an entity that can turn around and use those tax dollars to get my fellow American citizens to not do business with me. The government owns 60% of General Motors, and these American tax dollars are funding business activity for one company, with the express goal of negatively impacting another company

Paul Atkinson, President of Toyota’s National Dealer Council, manages to capture the central problem with government intervention in industry without resorting to the hyperbole that so often accompanies such lines of criticism [via Radio WAOI]. Examples?

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Among the many unanswered questions as to what Prius owner James Sikes actually did or didn’t do to try to bring his runaway car to a stop, one claim of his definitely smells.  He says he received a recall letter from Toyota, and when he took it in to the dealer, he was told his car was not on the recall lists. Ouch! Read More >

A federally funded ticketing blitz in the state of Virginia landed a total of 6996 traffic tickets this weekend. The blitz, dubbed “Operation Air, Land & Speed” coincided with frantic efforts by state officials to close a$2.2 billion budget deficit. Supervisors ordered state troopers to saturate Interstates 81 and 95 to issue as many tickets as humanly possible over the space of two days.
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One of the main topics at the Toyota hearings held in recent weeks is the automaker’s practice of hiring former NHTSA officials to its lobbying team. At the time, we were inclined to believe that Toyota was hardly the only firm engaging in this practice, and thanks to some Washington Post reporting, our suspicions have been confirmed. Early controversy centered around Christopher Santucci and Chris Tinto, two NHTSA Office of Defect Investigation officials who now work for Toyota. In addition to these two, the WaPo has identified former NHTSA lawyers Kenneth Weinstein and Erika Jones as former NHTSA officials who also now work for Toyota. And then there are the former regulators who work for other automakers: Jacqueline Glassman, a former NHTSA chief counsel and then deputy administrator now works for a law firm that represents Nissan and Mercedes. And that’s not all:

Former agency compliance engineer Amanda Prescott now works for Ford. Former agency director of the Office of Crashworthiness Research, Ralph J. Hitchcock, now works for American Honda Motor Co. And past agency administrator Diane Steed is a partner at Strat@Comm, a Washington public relations and lobbying firm that represents General Motors Corp.

And once again, Toyota wriggles out of some of the most damning accusations against it, not by confirming that it actually holds itself to especially high quality and safety standards, but by proving that it’s just like every other automaker. As we noted some weeks ago, this loss of exceptionalism is the ultimate price that Toyota will pay for this scandal (not counting lawyer fees).

When it comes to mountains of data like the NHTSA vehicle complaint data base, one man’s junk is another man’s treasure(trove).  Yes, there are limitations. But the remarkable degree of similarity of the UA rate between most badge engineered cars, and GM’s consistently low UA ratings speak of statistical relevance to some of us. One of those is David Lapidus, (TTAC handle: David42), whose data diving and Excel skills vastly overshadow mine.

In the last data dive, I used numbers from Edmunds to come up with a UA complaint rate for 117 cars from MY 2005-2010, excluding the flurry of complaints filed with NHTSA after the Toyota mat recall 0f 9/29/09. But those are cumulative, over the five years. David has taken it to the next level, to the individual model year. We may come back to the whole list another time, but initially we decided to focus on the Toyota Camry, since its large volume of sales and UA complaints would inherently increase the statistical accuracy of the numbers. And although this data dive may not solve the UA puzzle, it does raise serious questions about the most recent recalls and the Congressional barbecue of Toyota. Read More >

Vladimir Putin has announced that his government will spend $19.6b (584 billion rubles) on auto-sector stimulus, with spending planned on technology development, employee re-training, direct subsidies, and cash-for-clunker-style consumer stimulus. Another $20b of investment is expected from foreign automakers. These measures are aimed at a host of of ills besetting the Russian auto industry and market, ranging from what the government describes as a 4-7 year technological deficit, and a 50 percent drop in sales last year.

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The private company that operates speed cameras in Denver, Colorado is ignoring the provisions of state law designed to protect the public. Motorist Bill O’Neil used his cell phone camera to document the lack of warning signs around a photo radar van issuing tickets on First Avenue in January, KMGH-TV reported. City officials entrust Redflex Traffic Systems, an Australian company compensated based on the number of tickets it is able to issue, with the responsibility of placing the signs. A police spokesman told KMGH that signs were out, just on the other side of the road.

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Back from his hibachi-tour to the hill, and a trip to China, Akio Toyoda this afternoon paid his respects to Japan’s Transport Minister Seiji Maehara, to Economy Minister Masayuki Naoshima, and to the man himself, Prime Minister Yukio Hatoyama. And what a difference it was compared to the enhanced interrogation in Washington. Read More >

The Japanese government floated a highly interesting idea in Geneva. It could possibly revolutionize international car trade. Except for the United States. According to today’s Nikkei [sub], the Japanese government has proposed that the World Forum for Harmonization of Vehicle Regulations, a working party of the United Nations Economic Commission for Europe, create a system for international whole vehicle type approval. The UNECE immediately began looking into the idea last Saturday, and as per the Nikkei, by Saturday evening, “a majority of the member countries had agreed to the proposal.” That was fast.

It did not need much work: An international mutual recognition framework already exists for automobile components. The USA and Canada are absent from this framework. Says the Nikkei: “But for vehicles themselves, automakers have to obtain for each model approval from their own government as well as the governments of the countries to which they export.” Well, not exactly. Read More >

In the TTAC Pedal Series “Toyota Gas Pedal Fix Simulated: Friction Reduced, But By Too Much”, I anticipated that the crude shim fix for the recalled CTS “sticky pedals” would result in an uncomfortable pedal feel at the least and  quite possibly unsafe characteristics at worst. A quick refresher: a carefully controlled degree of friction (hysteresis) is essential in an e-pedal, otherwise smooth changes and maintaining steady states in throttle position become difficult if not impossible. I wrote: “Undoubtedly, Toyota’s intended degree of friction will be compromised by this fix, to one degree or another. And drivers may find the fix unpleasant or uncomfortable, also to some degree or another. Clearly, this fix is a band aid to fix the intrinsic limitations of this design.”

I’ve been counting the days until someone complained about the results of the pedal fix. Yesterday it came, from TTAC reader JAQUEBAUER:

My daughter took her 2009 Camry in to the dealer today for the Gas Pedal recall, and were very surprised and disjointedness with the “fix” that Toyota has chosen for this problem. We picked the car up, getting the keys and a copy of the repair order from the cashier. We were not told about any precautions to take or be aware of changes in the operation of the car. The Repair order indicated that the cars computer was reprogrammed, and some work was done on the gas pedal. I asked her to test drive the car in the dealers parking lot before she went home, to check for any problems.

There were 2 issues she found unacceptable, that I want to talk about here. Read More >

This is left brain – right brain weekend. While the more image driven can submerge themselves in pictures of old car ads, the other faction can unleash their inner nerd with abandon. Yesterday, we covered how ABC had entered the grail of automotive disaster-fakery, previously populated by NBC and CBS. ABC’s smoking gun video had been torn to shreds.

Today, we turn our attention to the man who aided and abetted the tricksters: Associate professor David Gilbert of the renowned Southern Illinois University. His work has been inspected by Exponent, a research company hired by Toyota. Hired by Toyota? Well, that should discredit Exponent immediately. Not so fast.

Crash Sled thankfully has found a full copy of Exponent’s retort to Gilbert’s machinations. The report is hosted on the ABC website, so we can assume it passed ABC’s scrutiny, for what that may be worth. Let’s look at the report a little closer.

Warning: This discussion needs a basic understanding of electric circuitry. If that’s not your thing, then don’t waste you time reading further. We’ll leave you to Sunday’s pictures with the message that Gilbert is a charlatan extraordinaire, and that whoever put him on the stand to make a case against Toyota needs to have his or her head examined. However, should you own a 2010 Toyota Avalon, then you have slight cause for concern. Read More >

Instead of solving the truly pressing needs of the land, Republicans and Democrats are publicly squabbling over the relevance and veracity of the Biller “smoking gun” documents that claim to prove that Toyota hid safety problems. U.S. Rep. Edolphus Towns, D-N.Y., chairman of the House Oversight and Government Reform Committee, sent a letter on Feb. 26 to Yoshimi Inaba, president and chief executive officer of Toyota Motor North America Inc., that said the documents provided “evidence that Toyota deliberately withheld relevant electronic records that it was legally required to produce” in lawsuits. Towns went on to say that  the documents “shed some light on Toyota’s handling of the sudden unintended acceleration problem” and “indicate a systematic disregard for the law. Not so, says U.S. Rep. Darrell Issa, R-California. And he has a smoking gun of his own: Read More >

Police in Washington state will have the power to take any car for at least twelve hours under legislation passed unanimously by the state House earlier this month and considered by a Senate committee yesterday. State Representative Doug Ericksen (R-Ferndale) introduced what he called “Hailey’s Law” which would make it mandatory for police to grab the vehicle from drivers merely suspected — not convicted — of driving under the influence of alcohol (DUI).

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According to popular wisdom, the Koreans have no love lost for the Japanese. And likewise. What’s more, Koreans and Japanese car makers are bitter competitors for foreign market share. So wouldn’t it stand to reason that Korea would jump on the “down with Toyota” bandwagon with their 96 million feet? Just the opposite is true.

The Chosun Iibo, according to Wikipedia “one of the major newspapers in South Korea,” takes the position that Toyota could very well be “a scapegoat for U.S.-Japan squabbling.” Read More >