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Who really debuted the first ever mini-van? The title remains hotly contested, between Renault’s Espace, and ChryCo’s Caravan/Voyager twins (not to mention the VW Microbus). But to North Americans and Europeans, that’s a moot point; both were first in their respective markets. The 1984 off-spring of Lee Iacocca came from Chrysler’s S-Platform, a stretched version of the K-Car chassis. (Yes, the very chassis that saved the Pentastar brand with its first-ever federal bailout.) By rejecting the normal rear wheel-drive layout of the time, the Voyager came off as a modern marvel. It boasted a transverse-front wheel-drive layout, flexible seating, good fuel economy, a smooth ride and car-like handling– something that took the other two Detroiters several years to figure out.
Excerpt from an email sent by Soldiers of Solidarity’s I. S. Bill Hanline: “Lastly, the money for these programs came from somewhere. The automakers did not out of the kindness of their hearts offer job income security to us workers. There had to be a trade off. In other words we gave up something for those benefits and if I remember right it was the Annual Improvement Factor (AIF) that we gave up in exchange for lump sum payments during each contract period from 1984 to present time that paid for those benefit programs. We were told in each contract how much money would be put in the trust for our SUB and JOBS programs. Problem with that is there never was as much money placed in those trust as the union announced during the ratification of all those agreements. Instead during the life of those agreements the Union agreed to allow the automakers to pay as they went, instead of fully funding the trust, this is what caused any shortfall of which in turn placed a bigger burden on the automakers cash flow during times when they had to pay members their contractual benefits. That is the main reason for the automakers dilemma today. Senator Corker and Shelby need to be reminded of this fact and they should also inquire with the foreign automakers in their state they might find out that those automakers have income security programs vary much like the programs they want UAW members to give up.”
Sergio Marchionne, eat your heart out. There’s yet another car manufacturer in town. All the way from Iran, we present to you: SAIPA and the all new Miniator! Last weekend, Iranian manufacturer SAIPA launched their first Iranian-grown car, the Miniator, Automobilwoche [sub] reports. The compact sedan is powered by a 1.5 liter 4-banger – also of Iranian provenance – that makes 80 hp. Guess if they can build missiles and nuclear bombs, bulding a car should be within their grasp. A price for the ayatollah auto has not been announced. Saipa-chief Mehrdad Bazrpash said the “car will be affordable to give poorer people the chance to own a car.” It is widely understood that the price point should be somewhere around $10K. Saipa was established in 1966 to assemble the two-cylinder Citroën mini passenger car, the Dyane. Later they manufactured licensed versions of the Renault 5, Renault 21 and Kia Pride. SAIPA also produces the Citroën Xantia along with other Citroën models. The Iranian government is said to own 48 percent of SAIPA. I’m trying to talk Michael Karesh, who is currently with me in Beijing, to detour through Teheran on his way back to test drive the all new Miniator, but he’s making up excuses.
Yes, a WAR so absurd it gets its very own question mark. And yet there it is, lingering on the spanish language pages of peru.com. Stingray has kindly offered a computerized translation (with all the humor that implies) of this astonishing, you might even say scarcely credible revelation. “As a result of the global economic crisis, the major U.S. automotive companies: General Motors, Ford and Cryssler also entered into financial trouble. Ford and General Motors are several years owners of the Swedish ías Comp + “Volvo” and “Sabb” respectively. In the package of lifeguards big American companies such as settlement is the sale of the Swedish automotive factories in question. This decision by the two American giants had total chaos in these two automobile companies in Sweden. Such companies are already on sale and what’s curious is that nobody is presented as a possible buyer, no producers, investors in the industrialized world want to invest in cars because they too are in crisis.
Once upon a time, GM’s captive finance unit GMAC was the engine of its success, pouring billions and billions and billions of dollars into the General’s corporate coffers. At some point, the tail wagged the dog: cheap credit and lax lending practices fueled an unsustainable growth in new car sales. A bubble that recently burst (in case you hadn’t noticed). Meanwhile, GMAC’s mortgage unit ResCap pursued the same no-loans-barred policy, only worse. Then, in his endless (seemingly, at the time) pursuit of propping-up GM’s bottom line with asset sales, CEO Rick Wagoner sold 51 percent of the soon-to-be-troubled finance unit to, of all people, Cerberus (owners of Chrysler and Chrysler financial). Which brings us to today’s GMAC, which is about to go tango uniform, hoisted by its own retard. The only way out: change itself into a bank and scarf some major bailout bucks. Only there are rules for that sort of thing…
The Chinese government is considering plans to breathe new life in their still growing, but sputtering auto market. “Industrial growth is sharply declining and we have not seen a turning point yet. We feel a lot of pressure,” Industry Minister Li Yizhong said at a recent news conference in Beijing. The Minister laid out several initiatives, “but gave no indication any measures had been decided or when they might take effect,” Gasgoo says. The possible steps are:
– A $2.2 billion package of subsidized loans, targeted at improving technology and cutting energy use.
– Beijing might buy surplus steel to help producers and give aid to steelmakers for upgrading technology as demand plummets.
The on-again, off-again affair between China and the Gubernator’s favorite toy is on-again. China’s Changfeng rekindled its interest in the HUMMER, Gasgoo reports. “We never quit talks on acquiring the brand,” said Zhengchu Chen, General Manager of Changfeng Motor in an interview with Beijing’s Jinghua newspaper. “But now instead of doing it alone, we decided to form a partnership with AM General to reduce the risk as the global economy falters.” Changfeng and AM General LLC have a plan: the two sides are exploring possibilities of building a joint venture company.
Changfeng showed interest in the brand earlier in the year. Representatives of Changfeng even went to the U.S. on an inspection tour. They came back unimpressed. Reuters reported that “the Chinese SUV maker backed off after touring Hummer’s U.S. factory, citing limited potential to market the vehicle.” Well… The Chinese SUV market is still vibrant. From January through October 2008, China’s top 10 SUV makers sold more than 300K units. More likely: the price tag for HUMMER has dropped. And a joint venture with a maker of American military vehicles has certain, uh, inherent appeal. Already, there are several HMMWV clones in China, such as the EQ2050 by Dongfeng and the SFQ-2040 by SAC. So….
A short overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off.
Asia bourses bullish on bail-out, Bush not sure: Tokyo stocks rebounded Monday morning, with the key Nikkei index climbing more than 4 percent, “as investors reacted to hope that the U.S. government will eventually save the embattled top U.S. automakers,” the Nikkei (sub) says. Japanese traders also liked that the yen dropped against the dollar, which makes Japanese goods less expensive in dollar terms. The market ignored remarks by Bush that an auto industry rescue is far from imminent. “We’re not quite ready to announce that yet,” Bush told Reuters on Air Force One during a flight from Baghdad on an unannounced visit to Afghanistan.
What can happen if a company actually owns its real estate: Mitsubishi plans to raise its office rents in Tokyo’s Marunouchi business district by an average of 15 percent despite the economic downturn the Nikkei (sub) reports. Overall demand for office space is weak in Japan, but remains strong in downtown Tokyo. Mitsubishi is confident that its offices in central Tokyo will remain highly sought-after because most are equipped with state-of-the-art IT networks and feature cutting-edge, energy-saving technology.
Vigilantes in the UK and Italy used gunfire and flames to express their displeasure with photo enforcement. Last week, Italian activists blasted a pair of speed cameras late at night in the Campania town of Teano, Cassertasette news reported. Only the camera housings for the devices located on the Appia and Casilina roads suffered damage because local speed camera operators remove the machinery from the housing each night. It is not cost-effective to run the cameras overnight when traffic volume slows.
On December 3, a South Yorkshire speed camera was also set on fire. The device located on Barnsley Road was saved from more serious damage as firefighters from Brampton Station arrived on the scene in time to extinguish the blaze with buckets of water, according to the South Yorkshire Times.
Back in ’05, the year that Bob Lutz turned 74 for the first time, GM’s Car Czar called Buick and Pontiac “damaged brands.” Even the Detroit-friendly media seized on Lutz’ remarks as a sign that someone in RenCen had woken-up to the fact that eight is more than enough. It’s too god damn many. But no. Bob was forced to backpedal. “Everyone always says that I was sort of implying we were going to cut Buick and Pontiac. I never said ‘irrevocably damaged’ or ‘irreparably damaged” or ‘terminally damaged.'” And now, Mr. “The threat of bankruptcy is absolutely out of the question” has been forced to backpedal on his backpedaling. Maximum Bob told Automotive News [AN, sub] that “It’s really much better to have fewer brands, do it well and then market the hell out of them.” [Note: you gotta love any article that begins “If General Motors survives its cash-flow crisis…”] Of course, the winner of TTAC’s Bob Lutz Award didn’t hit the heights without hints. To wit: “Lutz declined to indicate exactly what will happen to Saturn and Saab but said business as usual is not an option. ‘They’re under strategic review,’ he said. That’s the corporate code, Lutz said, for: ‘We realize they’re not working, and something needs to be done.'” HUMMER, Saturn and Saab are (nudge nudge) bye-bye but the original damaged brands (Buick and Pontiac) live on? Bob lives is a strange world. Let’s visit!
An anonymous source sent us this heads-up. We’ll chase it up tomorrow (Monday). Meanwhile, back in October ’07, Newsweek pegged the number of GM retirees at 340k. So, if true, this works out to a $238m hit to GM’s bottom line. At least. UPDATE: GM spokesman Tony Sapienza tells us that GM paid up to $700 in “year-end inflation adjustments” to 284k hourly retirees on Monday. Some 73k surviving spouses received up to $455 each. The total cost to GM: $200m+.
Many have been guessing what annual U.S. car sales would amount to this year. Some confused souls predicted sales as low as 10m. J.D.Power now has the pretty firm conviction that the year will end with 13.2m light vehicles sold for the year in the United States, down 18.5 percent from 16.2m in 2007, says the Automotive News (sub) who received an e-mail from J.D.Power. However, the big slump happened in the last 4 months. For the last 4 months, monthly sales were under 1 million. Total light-vehicle unit sales will hit 870,000 this month, down 37 percent from December 2007. Now THAT’S bad. That puts the seasonally adjusted annual rate to 10 million light vehicles in December, down from 10.3 million in November. Now THAT’S even worse. The rate had not fallen to 10 million since October 1982. Meaning: The worst is yet ahead. If the non-buying trend continues, the confused souls will be right next year and we could see only 10m units sold in 2009. China wanted to sell 10m units in 2008, a target they will not reach. With a little luck, and an economic stimulus program that works, China could make the target next year and, horror of horrors, turn into the world’s largest auto market.
PS: According to the China Association of Automobile Manufacturers (CAAM), Chinese auto makers produced about 8.7m automobiles and sold more than 8.6m from January to November. They will close out the year in the mid 9m.
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