Stefan Jacoby has been the top dog at VW of America for over two years now, but he still has the fresh curiosity of a freshly arrived tourist. Sitting down with “Max” and the Washington Post to hump VWOA’s mass-market dreams, he offers a few thoughtful insights.
“Here, there is more cruising and long-distance driving. In Europe, there are more tiny roads and you drive more actively than in the United States,” explains the highly-paid executive. “We Germans drive and we are not drinking in the car. Americans have breakfast and coffee in the car. We have to adjust to this.” Mein Gott! With insights like this, Jacoby should have no problem breaking a million annual sales by 2018. All these things take is “a more user-friendly steering wheel and entertainment system, an accelerator and brake pedal that are farther apart, and larger cup holders.” Oh yeah, and not evaporating your brand in the process. Or, as VW exec Werner Schmidt once described the Americanization of the Mk1 Rabbit, “Malibuing” away the Euro-appeal that is the Volkswagen brand in this country.
“I certainly don’t want to leave you with the feeling that, y’know, things are humming,” quips Frtiz. “Because they’re not.” Then what, pray, was the point of today’s “progress report” snowjob? But Fritz is just kidding, things really are ginger-peachy keen. As recent trips to the Harvard and Michigan business schools taught him…
Kudos to AthensSlim for calling out the Saturn on the first guess. I’m guessing it’ll take a bit longer for this one, like say, the twelfth guess. No, that’s not a clue. But here’s one: it’s half the name of a famous belt. Good luck.
The UK Conservative Party, widely expected to replace the Labour government at the next general election, yesterday announced that it would continue issuing two million speed camera tickets each year. Shadow Secretary of State for Transport Theresa Villiers announced plans to tweak the current photo enforcement system while rejecting calls to scrap the devices altogether. “It’s time to put a stop to Labour’s cash cow camera culture,” Villiers said in a speech to the Conservative Party convention. “Ladies and gentlemen, a Conservative government would not fund any new fixed speed cameras because they are not the best way to make our roads safer.”
90 days out of bankruptcy, GM is taking a moment to explain just how well the turnaround thing is going. Or, to use the PR-present tense, how GM “Accelerates its Focus on Customers, Cars and Culture.” CEO Fritz Henderson explains in the report press release (PDF):
Over the past ninety days since we created the new GM, we’ve already launched a number of new, fuel-efficient, highly successful cars and crossovers; introduced a new marketing campaign that highlights our best-in-class fuel economy, quality, warranty and safety performance; sworn in a new Board of Directors; and overhauled our management. We are taking aggressive actions and moving quickly to transform our culture into one that is truly customer focused
Everything you need to know about this exercise in corporate affirmations (I’m good enough, I’m smart enough, and doggone it, people like me!) can be found in the slide (above) titled “Concerns” from the report’s accompanying presentation (PDF). Nothing about the crisis surrounding Daewoo. Nothing about a steady erosion in sales that no marketing effort has been able to turn around. Nothing about binge-and-purge inventory “management.” Nothing about the near-impossibility of showing a profit by the planned IPO. In short, GM glossed over its issues like a 12 year old with her first stick of Lip Smackers. Read More >
Fritz Henderson just confirmed in a conference call that GM’s VP for US Sales Mark LaNeve will be leaving the company by October 15. An email by Henderson obtained by the Detroit News, makes it clear just how long LaNeve outstayed his welcome. There’s damning with faint praise and then there’s this:
Mark has contributed significantly to GM in several key positions, including transforming the Cadillac brand and leading the vehicle sales, service and marketing organization during one of the most challenging periods in GM’s history. Please join me in thanking Mark for his dedication and wishing him and his family well. A replacement for Mark will be named at a later date
Greentech Automotive is the hybrid vehicle firm founded by the former CEO of Brilliance with plans to build a plant in Mississippi with funds raised through the EB-5 visa program. Not to be comfused with Hybrid Kinetic Motors, the hybrid vehicle firm founded by the former Chairman of Brilliance with plans to build a plant in Alabama with funds raised through the EB-5 visa program. Now that we have that clarified, we can declare Greentech the frontrunner of these two competing enigmas, for at least showing a few hecho-en-China prototypes. The DeSoto Times describes the prototype models as a hybrid coupe that can deliver 45 miles per gallon and go from zero to 60 mph in 5.9 seconds, a four-door, mid-size hybrid which should deliver 50 mpg, a zero-emission electric sub-compact capable of traveling 80 miles on a three-hour charge and a high-efficiency gasoline sub-compact capable of 65 mpg. Initial factory plans call for a $1b phase-one investment, which will get the plant to 150k annual capacity and employ 1,500 workers. Eventually, Greentech hopes to employ 4,500 workers building 250k units per year, and –get this– capture one third of the US market.
CBC News reports that Canada’s federal Justice Minister Rob Nicholson brought some glad tidings to a recent meeting of Mothers Against Drunk Driving. According to Mothers Against Drunk Driving (MADD) chief executive Andrew Murie, Nicholson promised to consider legalizing random breath tests for Canadian motorists. Surprisingly (at least to me), this is not news. “In June, a House of Commons parliamentary committee recommended changing the legislation to allow for random testing, arguing it is an effective deterrent. The change would also bring Canada in line with a number of other countries in Europe and countries like Australia, which have adopted similar measures.” Hey, if you’ve done nothing wrong, you’ve got nothing to fear right? I mean, if a police state saves ONE CHILD, it’s worth it. And MADD reckons it could save HUNDREDS of poor innocent children from the murderous hands of drunk drivers. “Murie said [random breath tests] biggest selling point is that it improves road safety, with drunk driving fatalities dropping 36 per cent in Australia after legislation was introduced, and 23 per cent in Ireland when it made the change.”
Brook from team-bhp.com sent us this heads-up re: the “other” burgeoning automobile market: India. “Here’s a list of the Top 20 selling cars in India. Ford doesn’t have one car in the top twenty. Chevy has one, thanks to a rebadged Daewoo called the Spark. Suzuki (Maruti) and Hyundai are the clear leaders. Tata could have done better if only the unfortunately named Indica Vista wasn’t so conservative. Most people confuse it with the older first generation Indica. Tata Nano volumes will pick up, but Jag and Landie’s owners barely make any money selling the car itself. Honda’s hawking overpriced (and poorly equipped) cars with terrible after sales service as ‘bonus,’ and Hyundai are stealing their lunch.” So now you know.
One of my good friends asked me a question that I thought you and TTAC’s B&B could answer better than I could. “Hey David, We just returned from the beach yesterday. I tried an experiment with the air conditioner in the car on this trip. If we set the A/C at the coldest setting the car usually gets too cold, we usually adjust the temperature higher to keep us comfortable. However, I think the way the A/C works is that turning the temperature up simply allows some hot water from the radiator to heat up the air conditioned air. So we simply turned the A/C on and off as needed. Admittedly it was not quite as comfy since it would get a bit cold and a bit warm. I have two questions. First: does turning the A/C on and off at ten or fifteen minute intervals damage the A/C (such as putting greater wear on the electric clutch)? Second: does manually cycling the A/C save gas? We measured gas mileage after such a trip and got 30mpg, which was the best mileage we’ve ever gotten on the Camry. But we just had the oil changed and the air filter, which was pretty clogged, changed too. So I don’t know if it was the ac cycling that caused the improvement in mileage or the change of the air filter.”
Today’s This morning’s GM WTF moment comes to us from CNN’s Assignment Detroit. It’s a damning report on GM’s post-bankruptcy travails, penned by veteran auto industry scribe Chris Isodore. You may remember Chris as the reporter to whom I recently gave shit about not giving a shit about GM’s refusal to release a secret list of closed dealers. Which TTAC’s number cruncher eventually created. Which all but the Orlando Sentinel ignored. Anyway, props to Isodore for doing a little barrel fish shooting, unearthing yet more disquieting factoids about your friendly neighborhood nationalized automaker. For example, “GM will now have to pay Saturn dealers between $100,000 and $1 million each to wind down, which will cost the company more than $100 million . . . GM spokesman John McDonald said that the company never counted on avoiding payments to dealers through a Saturn sale. So the collapse of the Saturn deal is not a setback.” Wait; what about the GM mothership’s lost volume/market share? Hope and change baby!
The new Delorean Motor Company is apparently exploring the possibility of buying GM’s Wilmington Kappa plant and building a Pontiac Solstice GXP-based sportscar there. The firm released the rendering above, and the following post via Facebook:
What if John DeLorean were still alive? Some of his greatest automotive accomplishments were at Pontiac, and now the Solstice is a new car without a brand, and DeLorean is brand without a new car…
After four years in Chapter 11 protection, GM’s largest supplier Delphi is returning to the land of the living. For now. Along the way, though, Delphi racked up some impressive bills. Automotive News [sub] estimates that GM has spent $12.5b on Delphi during its bankruptcy, and has pledged a further $1b in debt assumption, $2b in forgiven claims and $1.75b in investments in the new company. For these (taxpayer funded) sacrifices, GM will get Delphi’s money-losing US operations and steering unit business. Delphi’s new owners Elliott Management and Silver Point Capital walked away from $3.5b in debt to assume control of the company, and $6.25b in pension obligations were dumped by Delphi and had to be assumed by the Pension Benefit Guarantee Corporation. Delphi’s bankruptcy alone cost $400 million in legal and professional fees. The new company’s manufacturing base has been migrated outside the US, and its main business will be in supplying electronics and air conditioning systems. Expected annual revenue is $10 billion compared to the $22.59 billion the firm earned in 2005, before entering bankruptcy. But rather than tut-tutting the waste, greed and ineptitude that has marked Delphi’s bankruptcy, let’s take this moment to remember the thousands of employees and retireesDelphihascastaside in the name of rescuing the US auto industry. For, as the Sibyl of Delphi foretold in the 9th Century B.C.E., love of money and nothing else will ruin Sparta.
Honda is showing a new, near-production version of its forthcoming CR-Z hybrid sports coupe at the Tokyo Auto Show. According to this video, Honda is calling its design language “Advanced Sensual Bullet.” You feeling it? If not, research is already underway on modifications to make the neo-CRX look more like the ur-CRX. And styling aside, the contrast between the CR-Z (1.5-liter I-4 with IMA mild hybrid, FWD and a six-speed manual) and the Toyobaru FT-86 (2.0 boxer four, RWD and a six-speed manual) should make for some interesting road tests and endless internet debates. In 2011. Or perhaps even 2012. Still, these are encouraging signs for those of us who might have been tempted to declare the age of the entry-enthusiast car at an end.
Bloomberg reports that the US International Trade Commission has launched a probe of alleged patent violations which could result in the banning of all Toyota hybrids from the US market. Paice LLC won a 2005 civil suit against Toyota, in which Paice’s founder Alex Severinsky sought a court order banning the sale of Toyota’s Prius, Highlander and Lexus RX400h hybrids. Instead, an appeals judge awarded Paice $4.3m in damages, and ordered Toyota pay Paice a $100 royalty per hybrid sold in the US. In the current case before the ITC, Paice claims that Toyota’s Camry, third-generation Prius, Lexus HS250h sedan and Lexus RX450h are “are materially the same” and violate the same patents as those in its first case. If Paice can convince the ITC that Toyota indeed violated its patents, he will still need to prove that the little-known company has a market to protect. But Paice doesn’t actually want Toyota to be banned from selling cars. In the words of one patent attorney, an “injunction would have given Paice strong leverage to negotiate a lucrative licensing deal with Toyota…Paice always felt that their technology was worth a lot more than [$100 per car] to Toyota.” Read More >
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