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Up to now, straight state subsidies were a big non-no in the EU, except in extremely rare and narrowly defined special cases, say farmers, Airbus, windmills, and a catalog so long that it needs a special website. Subsidies to carmakers definitely were against the rules, except in the guise of “green” programs. That was then. For the sake of political expediency, “soft loan and loan guarantee schemes put forward by Britain, France and Germany in an attempt to help companies through the current economic crisis have been approved by Brussels under the recently-relaxed state aid rules,” the Financial Times reports. Bailouts are cool, at least temporarily.
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Intentional ambiguity, id est, “keep ’em guessing,” is a tried and true tool in politics and business negotiations. Case in point: For months, we’ve been following the on-again, off-again attempts to marry cast-off Detroit brands with Chinese buyers. Now, as some deals finally look like they are coming together, China’s top industrial planning official comes out and says that local auto makers lack “sufficient capability” for overseas brand buying deals, Gasgoo reports. Domestic auto makers aren’t ready yet “to go overseas and cooperate with big companies,” Chen Bin, head of the National Development and Reform Commission’s industrial coordination department, said in Beijing yesterday. WTF? (What Thinks Farago . . . .)
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Holy trough snuffling, Batman! That’s one piggishly large salary. Not in absolute terms. In absolute terms it’s a pittance. Lest we forget, try as we might, Tom Cruise scored $20m for Eyes Wide Shut. And that was back in ’99. And you could make a case that that GMAC CEO Alvaro de Molina’s ’08 compensation package was money well spent. After all, Big Al Jr. was at the sub-prime specialist’s helm when it scored $6 billion from Uncle Sam’s magical bottomless pocketbook AND de Molina got the Fed to throw out the rule book and make GMAC a bank instead of forcing it to file for bankruptcy as they’d promised. Reuters! Break it down!
In times of crisis folks tend to look for radical change rather than steady improvement. Before you know it, Steve Jobs is being (wrongly) touted as the saviour of the auto industry, recent authors are expounding on the Googlification of the industry, and GM is staking everything on the Volt. And I’m not even going to get into the theological implications. But like the old fable of the rabbit and the hare, the steady improvements will be what saves the industry. A study by Carnegie Mellon at Green Car Congress shows that plug-ins with smaller capacity than the Volt’s 40-mile EV range are a more cost effective strategy than the Volt moonshot. Go figure.
Take some deep breaths, Mr Jarvis, and check out what Gordon Murray Design is up to over at Autocar. It’s like open-source, and innovative and stuff. Man. Actually it is a pretty radical vision for such a traditional industry. And it’s being done by folks who know things about cars. Oh yeah, and it’s nothing like Google.
The New York Times has brought it to our attention that you can now buy speeding ticket insurance! Ticket Assurance will cover the cost of up to three moving or non-moving violations and two tow truck calls per year for $15.95 per month. The firm was founded by an Atlanta-area businessman who was inconvenienced as much by the process of dealing with taffic courts as he was by the fines he’d receive for speeding. “I didn’t want to take time out of my day to plead my case for something I knew was wrong,” says Terrence Byrd. “I thought there should be someone who should handle this.” So he started the firm which now has about 1,700 customers in 23 states. Subscribers are only covered for moving violation fines of $1k per year ($500 for non-moving), but Byrd says membership pays for itself if you receive $200 in fines per year. DUI, reckless driving and felony charges are not covered, nor are single moving violation fines of more than $350. All the restrictions take away much of the advantage over a radar detector, but if you know you are going to be speeding a lot, it might be worth the peace of mind.
Consumer Reports has released its annual auto issue and scorecard, and the results are hardly shocking. CR loves them some Toyota, Honda and Subaru, singling out the big H as building the most reliable lineup of vehicles (Element excepted). Toyota came in second, with the Prius winning top spot in CR’s new “value” ranking. Only Toyota’s Yaris and FJ Cruiser were unable to earn a “recommend” grade from the report. Mercedes has improved its reliability, reckons CR, but European brands are still lagging. On the American front, Ford is singled out as the high point among the American automakers, as “some Ford models now rival their competitors” from Japan. Too bad they’re the F150 and Flex, which compete for a shrinking market segments. Unfortunately, that’s as good as the news gets for Detroit.
Today, management of Opel presented a rescue plan to the Supervisory Board of the Opel GmbH. The bottom line of the plan: A decoupling from GM. According to Automobilwoche [sub,] the plan and the decoupling has been approved by the Supervisory Board. The head of the Supervisory Board is Carl-Peter Forster, who’s main job description is Head of General Motors Europe. It looks like GM will let Opel go. Well, not quite yet.
Sheikh Mohamed Al-Najimi of the Saudi Islamic Jurisprudence Academy has advised the Muslim community (via Al Arabiya) that burning ethanol and other alcohol fuels could be a sin. Al-Najimi said that ethanol runs afoul of the Prophet Mohammed’s ban on the sale, consumption, processing, and handling of all forms of alcohol. He does stress that this is not an official Fatwa, or religious edict, meaning ethanol is not officially banned by Sharia, or Islamic law. Yet. But hey, as long as this little guy gets beheaded on YouTube we’ll call it good. To be completely fair though, this isn’t entirely surprising. It’s hard to imagine that ethanol is wildly popular when you live on top of oceans of the real thing. Meanwhile, back in the decadent west, moral clarity (like oil) is a little harder to come by.
In a 2-1 decision, The Eighth District Ohio Court of Appeals ruled last week that Cleveland couldn’t issue red light camera and speed camera tickets to the drivers of leased vehicles. The dispute arose after a pair of speed camera tickets were mailed to the Dickson and Campbell law firm in January 2007. Attorney Blake A. Dickson noticed that under Cleveland’s ticketing ordinance, only the registered owner of a vehicle could be held liable for an automated ticket. He then appealed the $100 fines before the Cleveland Parking Violations Bureau, arguing that his law firm leased the car from VW Credit Leasing, the registered owner. “OK. Well, we are going to go after the [lessee] then, sir,” the hearing officer said as he declared the firm guilty.
You just know it’s got to be GM. And so it is. The words flew out of the mouth of Steve Tihanyi, the man who oversees GM’s sponsorships. Or, more accurately, the elimination of GM sponsorships. After all, in Bailout Nation, you can’t be seen to be having a good time on the taxpayer’s nickel. (Although GM spokeswoman Kelly Cusinato helpfully pointed out that there are no advertising or marketing restrictions attached to the government loans or the company’s viability plan.) The latest casualty: GM’s 25-year sponsorship of the NCAA men’s basketball tournament. Bloomberg:
The company will slash by at least 60 percent on-site spending at the Final Four, even though this year it will be held blocks from GM’s headquarters in Detroit. The company is trimming dealer-incentive trips to the championship rounds and billboards downtown. Tihanyi wouldn’t comment on how much the 60 percent cut in on-site promotion and entertainment would save.
’Cause that would be telling. Oh, and Bloomies forgot to mention that GM’s not going to use its swanky skybox seats at this year’s final four. What’s the bet they’ll go empty?
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