OnStar’s Privacy & Compliance Officer Jane Speelman has an “I can’t let you do that Dave” moment in a Fastlane webchat titled “Onstar Debunks Privacy Misconceptions.” Yikes!
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We liked Fritz. We felt that Fritz had more energy and more drive and got the message that things had to change and was being groomed to be CEO and deserved a chance… He’s shown that he can manage. Whether he can fundamentally change the culture of the company is another matter.
Bloomberg’s fresh sound bite from former car czarlet Steve Rattner. Well, considering you left him in charge, Steve, he’d damn well better change the culture of the company. Otherwise it reflects just as badly on the restructuring task force as it does on GM, doesn’t it? Come to think of it, picking Fritz because he had “more drive” than Rick Wagoner wasn’t really a good setup for fundamental culture change, was it? You don’t hire Larry to move your piano because he’s “higher energy” than Moe. But it’s not Rattner’s fault: GM’s inability to change its culture comes from its inability to hire the professionals. Which means Ken “the pay czar” Feinberg and his ridiculous pay limits are really to blame.
We weren’t the only outlet to note Volkswagen’s apparent 2010 production volume win over Toyota a few days ago. Not so fast, Toyota tells Automotive News [sub]. Volkswagen’s total included production by joint ventures in which it does not hold a majority stake, Toyota’s didn’t. On an apples-to-apples basis (with minority stake affiliates included) Toyota built 4.9m vehicles in the first three quarters of 2009, to Volkswagen’s 4.4m. And because Toyota cut so much production early this year, while VW rode the European (particularly the German) cash-for-clunker wave, Toyota will continue to gain ground over the rest of the year. And the gap could widen in 2010: VW should see a certain amount of downturn in its core German market now that the abwrackprämie has expired, while improvements in the US and Asian markets should help Toyota. Not that Toyota cares about being number one. “Toyota’s goal is to focus on the customer, so we’re not focused on being No. 1,” ooze the spokesfolks. Well thanks for correcting us anyway.
Senator Corker, rest easy: the imports have your back. Tennessee-based Saturn may be shutting down, but Nissan is bringing the manufacture of their electric car, the Leaf, to Smyrna, Tennessee. Nissan made the announcement today as Rutherford County commission member voted to approve the funds required for the project. Under the scheme, Nissan will get $2.5 billion for the project plus a tax holiday of 20 to 40 years. In return, Smyrna will receive, up to, 1300 full time production jobs. That works out to be about $1.92 million per job. Not to mention a drop in tax revenue for the state. Let’s hope this Leaf is attached to an evergreen project and not a deciduous one.
GM surprised more than a few observers when it announced it would build a police-only Caprice model, based on the global RWD Chevy Lumina/ Holden Statesman. “Why build a fleet-only model and miss out on some private volume?” we asked at the time. Well, it looks like Ford’s about to do the same thing. A presser announces the development of a “purpose-built Police Interceptor specially designed and engineered to replace the Ford Crown Victoria law enforcement vehicle lineup in 2011.” Given that time table, “all new” is at least partial exaggeration (as it so often is). And it’s possible that this was motivated in part by the cool reaction to news of a possible Taurus-based Interceptor. GM went to Australia for their police-duty RWD platform, might Ford do the same with a Falcon-based interceptor? Or is this the prelude to Panther 2.0? Or, as common sense seems to dictate, is the Interceptor “all new” simply because there’s just never been an Interceptor based on this Taurus before? If Ford is really engineering a dedicated fleet vehicle for US production with no civilian counterpart, they’re as crazy as GM is. D3 it is.
Crank up production of the big green Hybrid stickers, ’cause the Regal is going to sport some serious hybrid regalia. No less then two of GM’s raft of hybrid systems may find their way into the Opel/Buick. gm-volt.com cites a report in Ward’s Auto [subscription] that GM will start production of an updated version of their not-even mildly successful mild-hybrid belt/alternator/starter BAS system in late 2011. The current version of that hybrid in name only system was available on the Malibu, but its economics compared to the four cylinder/six speed automatic made it irrelevant, as in canceled. But this new version has a plus symbol attached, so its going to really fly this time: Read More >
Reuters reports that Japanese manufacturers are running scared from Hyundai-Kia. A combination of a rising Yen and South Korea sealing more and more free trade agreements with other countries has helped Hyundai-Kia immensely. Of course, copying Toyota’s business model of building reliable cars at affordable prices has helped greatly, too. All this momentum from South Korea is getting Japanese car executives a little bit nervous. “I think there’s a sense of crisis in the whole (Japanese) industry,” Toshiyuki Shiga, chief operating officer at Nissan Motor. “Whether you take the Free Trade Agreements or foreign exchange policy, I get the impression that South Korea is tackling things well.”
There’s no shortage of analysis hailing Ford’s last-man-standing status, but there’s plenty of buried truth that’s not being brought to light. For example, Ford’s version of Delphi, bankrupt spun-off supplier Visteon. The firm’s non-European and Asian operations have been in Chapter 11 bankruptcy since May, and according to Automotive News [sub], it’s running out of DIP financing. Ford financed the supplier’s first month in bankruptcy, after which Visteon began burning through cash it was holding as collateral for its borrowings. And now that money is set to run out in March, forcing the firm to go hunting for $150m in further DIP financing. Unsecured creditors are objecting, calling the move a power grab by senior, secured lenders who seem willing to lend more money in order to edge out unsecured claims. And while that battle rages on, other OEMs are bailing on Visteon. Chrysler will come up with some $31m to buy back its supply business from the weakened supplier, Nissan is buying its Visteon-run North American interior plants back for $11m, while GM shifted its Visteon business to competitors at a cost of $22m. Ford, Visteon’s biggest customer and former owner is making no such move to abandon its most crucial supplier. If DIP funding comes up short, or if more bumps appear in Visteon’s bankruptcy (or if things continue as normal… Visteon lost $38m last quarter), Ford will face the brunt of the fallout. And with $30b in debt, and no government escrow account to draw on, Ford won’t be able to help out Visteon the way GM rescued Delphi earlier this year.
You know how terrorism experts talk about increased “internet chatter” as foretelling some kind of attack? On Monday, GM will release its post-C11 financial results which, thanks to dubious accounting, could very well mean nothing. Even so, I’m getting the feeling that there’s some bad news a brewin’, ’cause the MSM is kissing some major GM butt today. First, the Freep shows GM’s Chairman of the Board the love that dare not grant it an interview. Now the Times’ Bill Vlasic, late of the Detroit News, shows up with a piece that supposedly reveals the depth and breadth of GM’s much ballyhooed “cultural change.” Mea culpa comes in the form of “After bankruptcy, G.M. Struggles to Shed a Legacy of Bureaucracy.” While I’m a firm believer that cultural change starts at the top—such as, I dunno, firing the ancien regime that led to GM’s nationalization—I’m all ears, Bill. Where’s the evidence that la plus ca change, la plus ce n’est pas la même chose?
Ever get the feeling that the car game is dealing with some malaise? Dieter Zetsche sure seems to. “The definition of luxury will be somewhat different,” Doctor Z tells the Wall Street Journal. “It will be fewer CO2 emissions and more modesty in appearance.” And this from the company that sells cars on the back of a brand dripping with immodesty and ostentation. But no matter, the decision has been made: Zetsche wants to chase what the WSJ terms “Americans’ growing interest in downsized models that offer upscale features and finishes.” Wait, growing interest? The MINI sells decently, but the A3 (fewer than 3k units sold year-to-date) and 1 Series (fewer than 10k units year-to-date) are hardly setting the luxury segment on fire. Damn the torpedoes, people want green modesty, and Zetsche’s going to give it to them with four compact models planned for the US sometime after 2011.
For sure, there will be another B-class, which will be pretty similar, address the same customer as the B-class today. The three other body styles clearly intend to target additional and different segments from the one that we can target today, including gender barriers.
Smaller, greener and more identity-politics-y. That sounds like just what the luxury market has been begging for! And we haven’t even started in on the cost-cutting yet.
In four day’s time, my byline will appear on this website for the last time. During the previous nine-and-a-half years, I’ve watched the mainstream automotive press slowly evolve from paid cheerleader to . . . nope that’s it. No progress there. Despite having written literally thousands of diatribes against the media’s willful ignorance on the auto industry, I’m still galled that people who call themselves professional journalists have such little moral fiber and testicular fortitude. Only more so, now that GM and Chrysler’s endless turnaround promises have been revealed as a combination of epic self-delusion, outright lying and near-as-dammit criminal conduct (e.g. we never got the bottom of that SEC accounting case). This morning’s Detroit Free Press continues the tradition. “GM Chairman Ed Whitacre clear he’s in driver’s seat” is the worst kind of non-journalism—the kind that enables the rape of the American taxpayer by a bunch of egocentric incompetents.
Automotive News [sub] has more bad news for Saab dealers and customers. Saab’s prospective new owners have put the hit out on 81 of Saab’s current 218 US dealerships. If all goes according to plan, a measly 137 US Saab dealers will remain. Saab’s thin and uneven sales and service network has been an issue for the brand forever, and this isn’t going to make it any better. “The target date to close the sale of Saab is Nov. 30, but it could take until year end, says Mike Colleran, COO of Saab Cars North America in Detroit.” Don’t count on it.
Automotive News [sub] reports that President Obama’s Pay Czar has done an about face. Kenneth Feinberg pledged to remove the $500,000 salary cap for NEW executives hired for TARP-recipients—if he’s convinced that a rule-busting pay boost would help the bailout queens return U.S. taxpayer’s money. Feinberg’s climb-down comes just two days after New GM’s federally-appointed Chairman of the Board said that Uncle Sam’s pay caps could be, indeed should be, “modified.” Of course, Ed Whitacre didn’t make his suggestion directly. Nor did Feinberg reveal the locus of his “come to Jesus with cash” moment. “[Feinberg] said the automotive firms did not appeal his rulings. But he said he would be open to requests to hire in new executives at competitive pay. ‘If General Motors or any other company wants to bring someone in laterally — laterally — and competitive pay packages require that lateral hires get certain competitive pay, what have you, we’re perfectly willing to examine that.'” So the new rule: GM can hire someone for more than $500,000 in cash per year if that person was already making $500,000 per year doing the same job, only better (one would hope). Which would exclude, uh, no one. And create mucho resentment at that special place where RenCen’s express elevators ascend to glory. More Feinbergian 180 after the jump, and a mystery to be solved . . .
While other brands are busy closing down dealers, Volkswagen is buying them. They buy the big ones, to be exact. The smaller ones have been eliminated ever since yours truly has been working for VW.
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