The Opel/GM saga has more twists than New York’s Peppermint Lounge. Yesterday, we reported that GM’s Smith & Reilly went to Berlin to beg money from German Economy Minister Rainer Bruederle. They received the cold shoulder.
Like good salesmen, they didn’t take no for an answer.
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A very strange spy scandal is brewing between (South) Korea and China. Acting on a tip of the (South) Korean National Intelligence Service (the Korean equivalent of the CIA and FBI rolled into one,) Korean state prosecutors accused China’s SAIC of stealing sensitive state secrets from Korea.
Then, they indicted seven senior Korean engineers at Korea’s Ssangyong on charges of leaking technology essential to develop hybrid cars.
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US sales of the not very Smart car have fallen off a cliff. The Financial Times reports that “Smart sold only 661 of its fortwo model in the US last month, more than two-thirds below October 2008 and the lowest for any month since the car made its debut in the US early last year.” Other analysts are blaming low fuel costs and the foolishness of US consumers who just don’t get the appeal of microcars. Not me, I blame the fact that the Smart car is an all around underwhelming vehicle which gives up too much capability in return for mediocre fuel economy. Note that the Smart brand is a failure in Europe as well. “Daimler’s decision to export Smart to the US was a critical part of its rescue plan for the brand. For all its pizzazz, the little car has been a financial millstone. Daimler came close to shutting down the brand in 2006, but opted instead for a €1bn ($1.5bn) restructuring aimed at making the business profitable by the end of 2007.” How anyone (let alone Roger Penske) thought a failed European microcar would be saved by exports to the US is beyond me. Smart’s new “Value Days” 1.9% financing promotion isn’t going to get the job done. Not even a Toyota-esque Saved By Zero campaign would do the trick.
“Just because you have money doesn’t mean you’re smart” has a new poster boy. According to The AP :
A man blamed a low-flying pelican and a dropped cell phone for his veering his million-dollar sports car off a road and into a salt marsh near Galveston. The accident happened about 3 p.m. Wednesday on the frontage road of Interstate 45 northbound in La Marque, about 35 miles southeast of Houston.
How many Bugatti drivers live in Lufkin?
Think the new Z4 is a bloated boulevard cruiser unworthy of the roadster-implying Z badge? We’d tend to agree. Which is why we were chuffed to see renderings of a possible BMW 1 Series-based Z2 roadster in the most recent Auto Motor und Sport (print edition). Several Einser engines will be available say AM und S, up to and including the 306 hp 135i engine. BMW M division boss Kay Segler even hints that an M car based on the 1 series is in the works. This roadster seems like as good a variant as any for the treatment.
Were you looking forward to GM’s first post-bankruptcy financial report, set to be released on Monday? We sure were. Right up until we read that the earning statement won’t be compliant with a little something called Generally Accepted Accounting Principles. Automotive News [sub] reports that GM will use so-called “managerial accounting,” (do we have an accountant in the house?) until Q1 2010 results are filed using SEC-approved “fresh start accounting.” The SEC is apparently aware that GM is still transitioning to the post-bankruptcy accounting system, and has reportedly approved GM’s timetable for compliance. Meanwhile, GM’s 3rd quarter results will be announced in two parts, for the period it was in bankruptcy (June 1- June 9) and after (June 10- September 30). GM’s spokesperson is kind enough to explain:
In some cases, it’s not comparable to do a year-to-year comparison. Anything with a cost component to it, won’t be comparable. For sales and revenue, it will be comparable. It’s going to be kind of complicated this time around. There’s no way around that. It’s not a standard situation.
Don’t you just hate it when that happens? You try and you try to be transparent, and then your financial results come out all unintelligible because it takes the better part of a year to switch accounting systems. No wonder Whitacre is downplaying talk of a Summer 2010 IPO.
You need to go to your toughest market. The state of California is the biggest nut to crack for Buick. Californians love their Toyotas, they love their luxury cars, their BMWs and their Priuses, Buick is not even on their radar screen. These people don’t know this Regal. Picking the L.A. Auto Show demonstrates some confidence we have in the product and in the brand.
So says GM’s Susan Docherty in the Detroit News. Of course, it also shows how screwed the Buick brand is. California on its own is one of the largest markets for cars in the world, and it’s also home to some of the most virulently anti-domestic-brand sentiment in the country. Which explains why Buick is trying to win over the Golden State with its first-ever imported model. But as Docherty says, “One car doesn’t transform a brand. You have to have a series of successes so one, plus one, plus one equals more than three.” Meanwhile, while Buick tries to convince Californians that they don’t actually want a Lexus, everyone who thought they knew and loved the Buick brand will just be confused.
Though New York’s new “Empire Gold” license plates aren’t opening the same constitutional can of worms as South Carolina’s recently-rejected “I Believe” plates, they’re still generating some feisty political opposition. By next April, every licensed vehicle in the state will have to switch to the new plates, at $25 a pop. That’s ten bucks more per plate than the previous models, and keeping your previous number or vanity plate will cost an additional $20. The switch is estimated to raise $129m for the state, which is currently facing a $5b budget shortfall. But according to Newsday, some 57,000 New Yorkers have signed a petition at nonewplates.com, expressing their displeasure with the new plates and their fees. Best of all, the new plates will mean new jobs for 120 inmates in New York’s penal system. The inmates will be paid 42 cents per hour to produce the plates.
“You’re going to see it of course in the 3 Series,” BMW’s Tom Baloga tells Inside Line, “and the 5 Series is a good possibility. If the performance [of such an engine] is sufficient in the X3, U.S. customers would likely accept it in the X5 as well.” The “it” he’s referring to is BMW’s two liter turbodiesel engine, which BMW hopes will soon make up 10 to 20 percent of its engine mix in the US. And the Bavarians aren’t bringing the diesel four over for mere miserly mileage alone. “We would be focusing to make sure we get the performance that people expect without squeezing every last mile per gallon out of it,” Baloga says. “I don’t think we would ever consciously look at [the VW Jetta TDI’s] numbers and say ‘we have to beat that.'”
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Sexy+Training-+Auto+Supermarket+Hot+Parts+Video+(E
Sex sells. Or does it? I’ve long argued that sex actually gets in the way of selling cars. Who can think about cars when they’re thinking about sex? Sure, the blog posts on The Babes of SEMEN—I mean SEMA get eight billion hits. But so what? Does a pretty face and a pneumatic chest do anything to stimulate people to buy the trash and treasure (mostly trash) on display at a show or available (God help us) via the web? The example here is a perfect example of why you catch more flies with honey than vinegar. But as far as I know, the only reason to catch flies is to kill them. Or at least trap them on a sticky stuff until they die. Hey, come to think of it, maybe sexual come-ons (so to speak) aren’t such a bad idea . . .
Times are tough. Margins are tight. Carmakers are looking for savings anywhere they can. As mechanical work performed by a dealer under a manufacturer’s warranty comes straight off the automaker’s bottom line, it’s not all that surprisingly that we’re getting reports that certain manufacturers (cough Chrysler cough) are dragging their heels on paying for warranty work. In specific, we’re hearing that owners of Cummins diesel-powered Rams are having to stump-up for the cost of engine repairs, as the mothership blames “issues” on driver negligence, poor operating conditions and the knock-out punch “contaminated fuel.” Are you having any trouble getting warranty work on your vehicle(s)?
There’s all kinds of controversy over what makes a car “green” and what doesn’t. Some point to size and efficiency, crucifying Hummers and full-size trucks as criminals against the planet. Others point to lifecycle greenhouse gas emissions, battery-component mining pollution and other less-obvious measures to excoriate hybrids. In any case, TTAC’s scientific department isn’t well-funded enough to issue a comprehensive report on the subject. Forbes may not have tested cars itself, or dug into true “dust-to-dust” footprints, but it’s gone ahead and published a list of “America’s Dirtiest Vehicles” anyway. Let’s take a look, shall we?
Brace yourself ladies and gentlemen, because an automaker is taking on one of the American market’s greatest bugbears: size and weight bloat. Mazda’s vehicles have gained 80 pounds on average with each recent redesign, according to Robert Davis, senior vice president of product development and quality for Mazda North American Operations. Davis tells Automotive News [sub] that increases are coming “mostly in larger tires and wheels, and safety equipment,” resulting in a 2010 Mazda3 that weighs 2,868 pounds compared to a 2003 Protege’s 2,634 pounds. And, says Davis, that’s all about to change. He promises “typical” weight reductions of 220 pounds per vehicle on future Mazda models, through a combination of measures. For one thing, dimensional creep is a thing of the past, with some Mazda models scheduled to lose as much as three inches in length.
With Tata unable to produce enough Nanos to keep up with demand, more automakers are gunning for its entry-level segment. Renault-Nissan is teaming up with its Indian-market partner Bajaj to produce a car that’s even cheaper to produce than the Nano. “I can tell you the cost of this car would be lower than any car today made in India,” Renault-Nissan CEO Carlos Ghosn tells Gasgoo, adding that a lower production cost wouldn’t guarantee that the new car would be priced lower than Nano. The Renault ULC, as the low-cost car is being called during development, will be available in India in 2012, by which time GM and Toyota could have competing models on the market. Ford’s recently-announced Indian market low-cost car, based on the discontinued previous-generation European Fiesta, will be positioned above the Nano. And that strategy also appeals to Honda. The Motor Company tells the WSJ that rather than competing directly with the lowest-cost segment, a sub-Fit (Jazz, as it’s known globally) hatchback will be introduced around 2012 to compete with Ford’s model. The Jazz/Fit currently sells for about $15,000 in India, leaving a huge window between there and the Nano’s approximately $3,000 price price tag.
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