With GM repositioning its IPO to target US retail investors, we find ourselves motivated to once again sound the alarm about one of the major drains facing The General’s taxpayer-provided cash pile: the restructuring of its European Opel division. Opel slated its Antwerp, elgium plant for closure earlier this year, but at the time GM was trying to find a buyer for the plant. In May we noted that automotive overcapacity on the continent made finding a buyer for Opel Antwerp a tall order, and sure enough, Bloomberg reports that a buyer has not been found. What Bloomberg leaves out of its write-up: GM is now stuck with the €400m ($530m+) bill to pay off all those unemployed workers. A half-billion here, a half-billion there… soon you’re talking about real money.

The ad shown above seems to cement a sad reality for automotive enthusiasts: the objects of our passion are no longer considered the cutting edge of material culture. And this reality is reflected is reflected in more than just ads for mobile phones, the object that appears to have replaced cars as the touchstone of youthful cool. For a broad array of reasons, young people (the traditional arbiters of cool) are less obsessed with cars and car ownership than they once were. Even automakers themselves are rushing the automobile to the scrapheap of history by seeking to load ever more phone-like capabilities to cars, a trend that both fuels phone mania and disinterest in driving as an intrinsically rewarding experience. But, it seems, that cars can still be cool after all…
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When Alan Mulally came to FoMoCo, his strategy was simple. Quite literally. “One Ford.” Jaguar? Out. Land Rover? Out. Volvo? Out. Mercury? Out. Aston Martin? Out (but we’ll keep a small stake, just in case…). It’s all about “Ford.” And it’s worked. Ford is flying high and is closing in on GM in the US market. But there’s one thing that stops Ford flying even higher. It’s that millstone around their neck, called debt. And lots of it. About $27.3b in the most recent quarter. Some economists believe that is what is depressing Ford’s stock price. Well, it seems Mr Mulally is going to have a laser focus on this problem. Read More >

I used to play poker a lot. So I’m perfectly aware of the old adage “Strong is weak and weak is strong“. If someone is acting weak, chances are, they’ve got a good hand and are trying to lull you into a false sense of security. Likewise, if someone is acting bold, then there’s a good chance they’ve got “rags” and are trying to scare you off to collect the pot for themselves. Like when Cerberus purchased Chrysler. It was an open secret in the industry that Chrysler was ready for the knacker’s yard…again. But Cerberus still pushed ahead with the purchase. Eventually, Chrysler failed and Cerberus lost money. Which made everyone wonder “What were you thinking?” I have a suspicion people will start asking the same question about Toyota soon. Read More >

Maybe Henry Ford’s conquest of the automotive world with one model in one color is a little too ambitious a goal to repeat, but Alan Mulally is determined to take Ford further (back) in that direction. From 97 unique models in 2006, Alan’s goal is to keep reducing the body count: “there will be less than 30, on our way to 20 to 25”. Read More >

Rumors of Mitsubishi’s demise in America are greatly exaggerated. That was the essence of Mitsubishi Motors President Osamo Masuko, in an article at AutomotiveNews [sub]. “We have never thought about withdrawing from the U.S. market, and we will not do so.” And the sales target is 200k vehicles, four times of current levels. And what is the target date for that rebound? Not stated.

What was stated by Masuko is that the current crop of duds in the lineup will have to be replaced: “I cannot speak about it too concretely, but from what we know at the moment, it is not possible to continue with the models that we have had,”. Quadrupling sales without a specific plan for new models? Sounds even more ambitious than VW’s American re-conquest. Read More >

Despite not having spent a dime on the US firm, Fiat is widely credited with “rescuing” Chrysler. Here’s another way of looking at it: the United States taxpayers bailed out Fiat, an Italian firm with no presence in the US market. For no money down, Fiat got a 20 percent stake in a Chrysler that, although troubled, had been rinsed clean in bankruptcy. Now, analysts looking at Fiat’s spin-off of its automotive unit are telling Automotive News [sub] that

In order to produce and sell cars in China, foreign firms are required to form joint partnerships with a Chinese firm. With a ten-year, $15b government EV stimulus in the works, automakers are complaining that a requirement to build EVs in partnership with Chinese firms amounts to government-mandated barrier to market access. A foreign automaker executive complains to the Wall Street Journal that the draft version of the government plan is

tantamount to China strong-arming foreign auto makers to give up battery, electric-motor, and control technology in exchange for market access… We don’t like it.

China’s automotive market is projected to grow faster than most, and with $15b of government assistance, the Chinese government has a big carrot with which to tempt foreign firms into sharing their technology. But the backlash is already building…

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There used to be a time when Japan exported cars. Now, they export car factories. Nissan has been on the forefront of this movement for a while. Now comes their biggest export deal: Nissan plans to double its capacity in China by 2012, writes Reuters. That would bring their annual capacity in China to 1.2 million units. Read More >

Since the recalls,  hearings, etc. it’s been difficult to gauge what effect this had on Toyota. On the one hand, sales are falling in the US, but globally, sales are up. Looking at it one way, Toyota had to raise their incentives to shift metal; looking at it another their incentives are still below market average and nowhere near GM, Ford and Chrysler. Companies that are committed to lowering their incentives. Well, here’s another story to further confuse us. Read More >

Bloomberg reports that Ford will not build its Kuga compact crossover at its Louisville, KY plant due to the falling Euro and UAW recalcitrance. According to the report

The promise of Kuga production in Louisville began to fall apart in November when UAW members rejected Ford’s request to match givebacks it gave General Motors Co. and Chrysler Group LLC. Ford’s U.S. rivals, which each reorganized in bankruptcy last year, were granted a six-year freeze on wages for new hires and a ban on some strikes until 2015… The euro has fallen 14 percent against the dollar since Ford reached a tentative deal with the UAW in October to build the Kuga in Louisville alongside its mechanical twin, the Escape. At the time, the dollar had declined against the euro, lowering the cost of U.S.-made goods. Since then, the euro has dropped amid concerns Europe’s debt crisis may trigger another recession.

Barclays analyst Brian Johnson explains

This is a reminder to the UAW that Ford’s U.S. cars don’t have to be produced in the U.S. Ford’s global architecture allows them to build anywhere. That’s good news if the U.S. has competitive labor costs. It’s bad news if they don’t

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When you start a new job, it’s considered important to make a good impression. How does the saying go? “Start as you mean to go on”. Well, Dan Akerson, I suspect, tried to heed that advice and ended up putting his foot in it. The Associated Press reports that Dan Akerson, CEO of Government (soon to be “General” again) Motors, presented a webcast to GM employees. The usual CEO rhetoric came out. “GM needs to keep competitors on their heels rather than responding to what they do” said one GM worker, who asked not to be identified as the broadcast was not available to the public; despite being owned by them. “Attack mode” was another phrase used. But then Mr Akerson said that GM’s Cadillac brand has to make cars that are better than BMW’s. Now I thought this was quite a harmless statement to make. The CEO set a (quite high) benchmark to beat. Sounds reasonable, right? Not according to some. Read More >

If you think China’s auto growth is scary, then you find yourself in rare agreement with China’s central government. China’s 30 (!) major (!) auto makers had a production capacity of 13.59m vehicles by the end of 2009. Chinese bought 13.64m units. This year, it will be much more. By July, Chinese had already made and Chinese had already bought more than 10m units, according to data released by China’s Ministry of Industry and Information Technology.

Chinese buy more than just cars. They have bought (well, leased) enough land, buildings and machinery in order to more than double car output by 2015. With the current expansion and investment plans exercised, China will have production capacity for a mind-blowing 31.24m units by the end of 2015. That according to Chen Bin, head of industrial coordination at the National Development and Reform Commission, the nation’s economic regulation agency.That’s more than six (!) times the U.S. production in 2009, and three times the U.S. auto production in the heydays of 2007. You are not the only one to get worried now. Even China’s NDRC thinks that might be a bit much. Read More >

Suzuki is to India what Volkswagen was to China. Earliest foreign entry into a huge an untapped car market. Like Volkswagen in China, Suzuki built a dominant position in India early on. Suzuki owns half of the Indian market. Unlike Volkswagen, two-thirds of Suzuki’s operating profit is estimated to come from India. Volkswagen lost their commanding share of China (and made it up with volume) when the market exploded, attracted competition, and overwhelmed VW’s capacities. A mistake Suzuki seeks to avoid. Read More >

We can’t pretend to be overly enamored with former “car czar” Steve Rattner, who oversaw the auto bailout before being disgraced for his role in a New York pension fund pay-for-play scandal. Still, the guy was in the thick of things during last year’s negotiations over Detroit’s rescue, so he knows where the bodies are buried. And in his new book, Overhaul, which has been released to select outlets ahead of its October 14 publication, he tells a whole lot of stories about the months of bailout proceedings that led to the rescue of GM and Chrysler. Of course, Rattner has an agenda in all this, namely proving that

so he’s not necessarily an unbiased source. But with grains of salt at the ready, let’s dive into his spilled guts and see if what secrets lie beneath.

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