As GM’s CEO tires to find federal cash to feed his company’s conflagration, his minions are busy throwing furniture into the fire. The AP reports that Buick has yanked courtesy car provision from its PGA sponsorship. “Buick will no longer supply include the U.S. Bank Championship in Milwaukee, the AT&T National in Washington and the Transitions Championship outside Tampa, Fla. The Shell Houston Open remains hopeful of keeping its Buick courtesy car deal.” Talk to Larry… “We’re taking a hard look at everything right now,” admitted Larry Peck, golf marketing manager for Buick. Ah, the good old days… “In some cases, the company provided 180 courtesy cars and a cash donation, receiving spots in the pro-am for Buick clients, car displays throughout the golf course and hospitality tents on the 18th green. At the John Deere Classic, Peterson said Buick donated a car for auction in its “Birdies of Charity” program.” And now…
Category: News Blog
Senator Harry Reid has revealed the devilish details of the bailout bill for Motown’s meltdown. First, as predicted here, the Dems are sticking to their guns. They’re insisting that the money come from the preexisting $700b Wall Street bailout, not the $25b Department of Energy Loans (which would incur the wrath of environmentalists everywhere). Under the Congressional bailout plan, Detroit could stick their snouts into $25b worth of Department of Treasury funds exactly one month after the authorization receives the President’s signature (should he decided to so affix). Automotive News [sub] crosses the i’s: “If enacted, the bill would direct the Treasury secretary to accept loan applications from companies three days after it becomes law and would require a decision on the applicant’s eligibility within 15 days. Disbursement of funds would have to occur within the following seven days.” Or what? They turn into a pumpkin? As for those strings attached, they’re no longer of the Jewish maternal nature (i.e. made of piano wire). “Companies getting loans would have to grant stock warrants or senior debt instruments to the government. Top industry executives would have to give up bonuses and golden parachutes; stockholders would receive no dividends.” Oversight board? Perhaps when Harry met Nancy they read TTAC. It’s nowhere to be seen. But there are other caveats…
The channel? Don’t you just love it when corporate speak bleeds over into the consumer-o-sphere, leaving customers clueless as to WTF the company’s talking about? Of course, TTAC’s Best and Brightest know that GM has launched a cunning plan to cull its dealers/brands by combining dealers/brands into four “channels,” and then letting them meld indistinguishably to the point where the individual brands don’t mean squat and any dealer who can’t make the unworkable work dies. You know, in about ten years or so. [Note to Rick: why don’t you see how Congress likes THAT plan?] Anyway, Buick/Pontiac/GMC. And I know the suspense is killing you. Or them. Well, someone’s dying. Oh wait! I know! Sales of the GMC Sierra Hybrid pickup truck, which “combines the fuel efficiency of a midsize sedan with uncompromised full-size truck capability, $39,365 (including $975 DFC) for 2WD models with the 3HA package and $45,500 (including DFC) with the 3HB package.” No, hang on. Maybe it’s the “all-new Pontiac G3 hatchback, $14,995 (including $660 DFC).” “All new” in the sense of America’s first crack at the hatchback version of the execrable Chevrolet Aveo. Remember: Pontiac is car. Not excitement. So, how can sales die before a new model’s launched? Simply a case of GM doing the time warp again.
German governments have long relied on (and often ignored) the advice of a council of economic advisers, called the “Five Wise Men”. Peter Bofinger is a member of the council. According to Spiegel Online, he says the only way to deal with Opel’s problems is to nationalize the company– and forget about the billions that GM reportedly owes Opel. Bofinger says there are two important reasons why this is the only way to go. Once the markets stabilize after a few years, Germany would be able to sell Opel again, and regain some or all of its investment. And that sure beats pouring money down GM’s drain. Secondly, nationalization is a deterrence to the many other companies asking for help, and the scores of companies that are expected to grovel for billions in the months to come. Picture this dialogue: “So, your hubcap-stamping business is in the dumps, you need 300m to re-tool your factory for selling ‘green’ accessories? OK, we’ll take the company off your back, free of charge.” So is Bofinger a Wise Man or a wise guy?
In 1965 Porsche introduced the 901, the 2-plus-2 successor to the 356. The car, designed by Butzi Porsche in 1963, wasn’t a clean sheet or revolutionary design. Even so, Porsche later changed the name to the iconic 911 due to a dispute with Peugeot, which claimed ownership to all cars with “0” as the middle digit.The early 911s were under-powered and gasp… underdeveloped until they lengthened the wheelbase in 1969, and gave it more power.The extra grunt arrived in 1970 via increased displacement, in the form of the 2.2-liter engine.
While America Slept (WAS) is a morning round-up of the news that happened in other continents and time-zones while America was tossing and turning. From Japan to Jakarta, a network of sleep-deprived TTAC correspondents provides round-the-clock coverage of everything that has wheels. Or that has its wheels coming off. Here are the latest animals in TTAC’s morning zoo.
Ford dumps Mazda. Tormented U.S. automaker Ford Motor Co may announce plans to sell a 20 percent stake in long-time affiliate Mazda Motor Corp as early as today, Japan’s Nikkei business daily (sub) reported as the sun rose in the land of the rising sun. Japanese broadcaster NHK had reported more than a month ago that Ford is looking to severely lighten-up on Mazda. Currently, Ford has a controlling stake of 33.4 percent in the Japanese automaker, but Ford needs the cash.
Sell-off drives up shares: Selling a 20 percent stake will net Ford around $850 million, or more. Mazda’s shares jumped 6.4 percent on the report of Ford’s sell-off. The estranged lovers share vehicle platforms and engineering resources and own several assembly plants together in the United States, Thailand and China. With Ford out of control at Mazda, those plants should receive some Japanese gardening.
Deal done. Later in the Japanese day, Mazda sent out an official release confirming the story. It’s in Japanese, but a usually reliable source (my Japanese wife) says it’s the real McCoy-San. Ford is down to 13 percent. Kawaii!
GM-Europe-VP: “The end may not be near.” Brent Dewar, multipurpose VP for Sales, Marketing, and After-Sales at GM Europe penned an inspirational letter to dealers: “As bad as the current results may sound, we don’t know whether we already have reached the end of the crisis.” Autohaus has a copy. From his bunker in Zurich, Dewar commands his sales forces to “fight to the last sale.”
And that WASn’t all, there’s …
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Detroit’s slow-mo meltdown has been rife with tipping points for years now. As bad decisions piled upon bad luck, we’ve seen the signs become increasingly ominous. The light at the end of the tunnel has become so faint now that each new misstep comes hard on the heels of the previous one, each taking on ever more existential significance. Perhaps though, we have reached a new low in the news coming out of GM today, as Automotive News [sub] reports that GM will delay incentive payments of $302.4m to its dealers for two weeks. If this decision was made based on GM’s liquidity crisis, it means that GM can’t come up with $300m until December 11: A stuffed stocking of not good. On the other hand, if it’s another twisted ploy to generate political support for a bailout, it’s some inspired stuff. Based on the letter (after the jump) sent by GM VP of Marketing Mark LaNeve, it’s looking like a little of both. After all, blackmail has always been a crime of desperation. Read More >
WardsAuto.com reports that Ford is following up on its pledge to cut fourth quarter production by, wait for it, 211k units. That’s a 35 percent drop from year-ago manufacturing levels. To implement the cuts, FoMoCo is “temporarily” idling nine plants:Louisville, KY; St. Paul, MN; Oakville and St. Thomas, ON, Canada; Kansas City, MO; Avon Lake, OH; Flat Rock and Wayne, MI; and Hermosillo, Mexico. In terms of the who what when where and for how long and how much longer than normal, and whether or not people are getting paid to work (jobs bank-wise), Ford spokesfolk Angie Kozleski was slightly… vague. “In terms of down weeks, some may have been scheduled and some are new,” says Kozleski. “But we’ll continue to adjust production capacity to demand.” True enough, but it’s not the most reassuring thing a spinmeister has ever said.
We’ve had a few confused comments on the Dodge EV vs. Challenger “drag race” video, so we thought we’d fill in some details. And post something between Bailout Watches. First of all, the stunt was choreographed by Chrysler. ENVI President Lou Rhodes is behind the wheel of the Dodge EV while a weak-ankled Chrysler employee handles a Challenger 6.1 with octegenarian restraint. Clearly this was intended as a PR two-fer. Chrysler gets to show off its Tesla wannabe and its muscle car, while giving the LA Times the opportunity to write about how Chrysler’s EVs and EREVs are the future. And clearly the point was to give the Challenger the fuzzy end of the lollypop in order to show just how advanced the Chrysler EV program is. Maybe next time they could be a little more convincing. The video doesn’t so much make the Dodge EV look like a muscle-car-beating dynamo, as it makes the Challenger look like a secretary special. The LA Times’ Dan Neil admits that the Challenger was launched in second gear in both runs, and that it “seems to let up” on the second run. Nobody will say for sure if it was a lift-off or an audio effect caused by the rev limiter. Regardless of the actual details, the real point of these video stunts is to look cool, and it’s in this crucial consideration that the video really lets down. Had the Challenger sat on the starting line, dramaticaly gasifying its tires while the EV scooted to victory, the PR “message” would have remained the same and it would have looked a lot better. As it went down, the stunt looked staged and neither car came out looking heroic. Better luck next time.
When they built it, from 1999 to 2005, the Audi A2 was a flop. Lots of Euro-car nuts like me loved it: a sub-Golf sized, lightweight (900kg), aluminum bodied four seater with great aerodynamics (CW 0.25). Its interior was beautiful and high-quality, it was quiet and it handled well. Ideal for city driving yet happy on the autobahn. This car was worlds ahead of the competition and left the Merc A-Class in the dust. I remember renting one TDI model with but 75 horses that felt happy and smoothe at 110 mph; I drove the hell out of it for a few hundred miles and still got 38 mpg. 50mpg was reported to be easy to attain. But the market hated it. It was pricey, and with gas prices low, it only looked like a sensible buy to tree-huggers. And the looks… the Bauhausian, spartan, slimline styling I loved was judged to be week-kneed and feminine.
I think it’s about time to dub Freep the official home of pro-bailout agitprop. When you make the Detroit News look like it’s being run by H.L. Mencken’s Tabasco-marinated ulcer, it’s time to rethink your priorities. Or adopt the tagline “fair and balanced.” Anyway, the Freep’s unabashed Detroit boosterism is reaching a fever pitch, with everyone capable of wielding subject and predicate pitching in for the noble cause of disguising self interest as principle. From old standby (and former Cassandra) Mark Phelan, to financial columnist Susan Tompor, to a condescending missive by the Freep’s editorial board, the latest issue rotates faster than a Baghdad Bob interview in Spin magazine. Let’s pop a Dramamine and take a look, shall we? Read More >
We’ve often wondered how many cars Tesla has actually delivered to paying customers. The company claims there are some 60 cars out there, somewhere. Well, thanks to Jason Calacanis’ patience over the last two years, we can now bring you this update: 16. Well, at least 16, as Jason has just taken delivery of Roadster number 16 (says so right on the VIN plate). But wait! That’s number 16 after the “Founders’ Series” of 27 Roadsters. So that would be… 43! But wait! Calacanis says the numbers aren’t delivered sequentially. His is 16, but, ’cause he asked for special paint job, cars with higher VIN numbers may have been delivered earlier. Anyway, after an intro that makes the opening credits of the original Batman series seem like a subliminal message, the 169th edition of TWIT (This Week in Technology) reveals all. Calacanis describes the prototype Tesla four-door as an Aston Martin combined with a Porsche and a Maserati, and says Tesla’s problems are now behind it. Which probably means they’re dead ahead.
Dwindling property tax revenue has forced local governments in Michigan to look to motorists to refill their municipal budgets, according to a Detroit News analysis. In 2002, the city of Detroit issued a total of 126,007 traffic tickets. Last year, that figure grew to 245,249– a 94 percent jump. The percentage increase was even greater in small towns like Plymouth, which saw the number of tickets skyrocket from 440 to 2,584 — up 487 percent — over the same period. “When I first started in this job thirty years ago, police work was never about revenue enhancement,” Utica Police Chief Michael Reaves told the DetN. “But if you’re a chief now, you have to look at whether your department produces revenues. That’s just the reality nowadays.” Utica issued 3540 tickets in 2003 and 5518 in 2007 — a 56 percent increase. A few communities like Pontiac saw ticket revenue decrease in proportion to the number of police laid off, but eighteen jurisdictions overall reported a ticketing increase of more than fifty percent. The National Motorists Association cited Detroit suburbs as home to the worst speed traps in the country.
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