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After swimmer Michael Phelps won a drawer full of Olympic gold, he signed a deal with Kellogg’s to promote Frosted Flakes. Stupid move. Tens of millions of parents know that Frosted Flakes make their kids bounce off the friggin’ walls. Part of this healthy breakfast, my ass. All Phelps had to do was align himself with brands selling healthy living and he could have smoked the finest Maui Wowee, in Maui, for the rest of his life. Anyway, Phelps got caught doing bong hits. A smart handler would have used the opportunity to strengthen the Phelps brand. “Michael is obsessed with fitness. He doesn’t drink alcohol or smoke cigarettes. He regrets using an illegal herbal drug for relaxation. He is now exploring yoga and other alternatives. He encourages his millions of fans to learn from his mistake, as he has.” Let the Mary Jane debate begin! Anyway, Phelps signed a million dollar deal with Mazda to promote the brand in China. (Huh?) When the swimmer got busted, they somehow convinced him to make this entirely bogus, po-faced apology. It manages to make both Phelps AND Mazda look stupid. Yes?
The Detroit Free Press reveals that Bruce Andrews, Ford’s vice president of government relations, is leaving the Detroit automaker to become the general counsel to the Senate Commerce, Science and Transportation Committee. The committee’s remit includes highway safety, international automotive trade agreements and, uh, transportation. The Freep dutifully reports that “Ford had brought Andrews on board to strengthen its ties with Democratic lawmakers.” Mission accomplished, I’d say.
I don’t know about you, but if I’d earned $14m in ONE YEAR, and I’d worked for the same company for thirty-two years, at least eight of which delivered unto me similarly (if not equally) spectacular amounts of pay and benefits, I wouldn’t really be all that worried about what happened next. OK, yes, reputation and all that. But we’re talking about Rick Wagoner, the man that’s flown the GM jumbo jet straight into the dirt without once recognizing that funny looking thing called the yoke. Any reputation that remains is purely in Rick’s head, and the heads of the sycophants who wear their “Pay No Attention To That Man Behind the Curtain” T-shirts with pride, without irony. So don’t expect me to be surprised that USA Today reports “GM, [Wagoner] says, is crouched and ready to pounce if the auto market begins to rebound. ‘We just need to get the storm over, and we’re about ready to go.'”
The New York Post reports that Chrysler CEO Bob Nardelli “transferred a $3.8 million, four-bedroom, five-bath Los Angeles spread to his wife, Susan, on Jan. 17, 2008, according to deed records filed in Los Angeles County and recorded with the Assessor’s Office on Feb. 5, 2008.” There are only three possible reasons for this move: divorce, estate planning or a hedge (there’s that word again) against future legal action, when creditors come to call. Strangely, or not so strangely, Bob’s personal spinmeister is denying the facts of the matter. “A spokeswoman for Nardelli early today insisted the records were incorrect and no transfer took place.” The story gets curiouser and
curiouser . . . .
GM Car Czar Bob Lutz is calling it quits at the end of the year. Or, as they like to say in the “here’s your golden parachute; see you in Aruba” RenCen echelons, Maximum Bob “will transition to a new role effective April 1, 2009, as Vice Chairman and Senior Advisor.” In other words, we still have MB to kick around until the end of the year or the end of GM, whichever comes first. GM CEO Rick Wagoner was effusive about Lutz’ contribution to the total destruction of GM’s brands—in his own entirely reserved way. “Bob Lutz was already a legendary automotive product guy when he rejoined GM in 2001,” Wagoner’s statement says. “He’s added to that by leading the creation of a string of award-winning vehicles for GM during his time here. His 46 years of experience in the global automotive business have been invaluable to us.” Love that “car guy” stuff. Now, for some more accountant-friendly info . . .
An increasing number of media reports are indicating that instead of a single “car czar,” Obama will appoint a team to oversee the auto industry turnaround effort. Current reports indicate that Democrat fundraiser Steve Rattner will likely take the top oversight position, but his total lack of (non-political) qualifications for the job is considered an issue. Which is where Stephen Girsky comes in. “They clearly need an adviser who knows the industry,” former Chrysler president Thomas Stallkamp tells Bloomberg. “Girsky certainly knows the industry, and he was close to both GM and the union.” And though I have questioned whether Girsky’s UAW affiliations are best described in the past or present tense, this 2004 presentation (PDF) to Original Equipment Suppliers Association is decidedly prescient. Especially for 2004. And this December 2008 presentation to UAW Local 14 seems to indicate that his recent advising stint with the UAW was a mission of truth and reconciliation rather than one of conniving and obfuscation.
There, I’ve said it. In their rush to report that Elena Ford is the Blue Oval Boyz newly appointed director of global sales, marketing and service operations; the MSM seems to have forgotten Ms. Ford’s Mercurial past. In fact, the fruit of Charlotte Ford and Greek shipping magnate Stavros Niarchos was appointed the head of Ford’s Voldemort (Mercury) in June 2004. Newsweek: “Elena is planning to roll out new, crisply designed models in 2004 to go after sophisticated young professionals who drive Volkswagens. Launching a youth movement won’t be easy and she admits the elderly customers ‘don’t fit perfectly into our strategy,’ but argues Mercury needs them to help fund the brand’s overhaul.” At the time, some commentators said that Ford was the only reason Ford kept plowing money into Mercury. Churlish perhaps, but how would you like to be the one telling the Ford family that you were pulling the rug from under Elena’s feet? So how does today’s press release spin this less-than-glorious chapter in Ms. Ford’s corporate career? Easy. They don’t.
What a difference a bailout makes. Read TTAC’s past takes on Corker here.
Warren Brown is nothing if not ambitious in his defense of the indefensible (i.e. GM CEO Rick Wagoner). Rather than just raise a[nother] cheer for the man who’s spent the last decade-plus jamming the yoke forward on General Motors’ inexorable descent into bankruptcy, the Washington Post carmudgeon decided to rewrite the entire history of the Japanese “invasion” of the American automotive market. But before he does that, Warren upbraids those who’ve called for Toyota Prez Katsuaki Watanabe to resign, suggesting that Watanabe and Wagoner are birds of a feather, getting flocked together. “GM, as we all know, has lost substantially more than $1.7 billion. In fact, it has lost $72.3 billion since 2004 under Wagoner’s reign. By that measurement, applying Fire the Coach rules, Wagoner is 40 times more deserving of dismissal than Watanabe. But here’s arguing that all of that is sloppy logic and in many ways inherently unfair. Here’s also suggesting that Fire the Coach management will solve nothing — or remedy very little — in an arena where game policy is athwart common sense, as it is and has been in a United States absent effective industrial and energy policies.” Same old you-know-what, different wrapper. Brown is once again, blaming everyone BUT Wagoner for GM’s chronic, shameful self-destruction.
Print is so dead. How anyone could expect a magazine with a two-month lead time to compete with the internet on the news front? It’s like pitting a semaphore line against G3 cell service. In case they don’t know it, the buff book’s business model is as dead as the carmakers’ they support. And while we await the car mag medium’s reinvention and rebirth (U.S. Evo please), we get to admire their attempts to remain au courant. I mean, poor todd lassa. Not only is the Motor Trend scribe’s name chronically under capitalized, but he also had to decide whether or not Red Ink Rick Wagoner would still be at the helm of GM in January 2009. What are the odds, eh? Unfortunately, todd erred on the side of common sense.
According to Automotive News [sub], investor Kirk Kerkorian’s Tracinda Corp sold off its 133.5m share position in the Ford Motor Company. Tracinda first revealed that it would divest its Ford holdings in regulatory documents filed in October. It has now confirmed the complete sale. Tracinda spent over $1b on Ford stake beginning in April, paying an average of $7.10 per share. At the time of writing, Ford is selling at $2.22 per share and falling. Kerkorian’s losses in Ford are estimated at over $660m. Still, the ninety-year-old money man can take the hit. Not only because he’s close enough to the end of his life to not give a dman, but also because Forbes rates “the Lion of Las Vegas'” current net worth at a $16b. Ford was the third Detroit automaker to attract Kerkorian’s attention; the sale marks the end of his tortured involvement the major domestic auto OEMs. Of course, when they file, Kirk or his minions might go bargain hunting…
I’ve finally convinced one of our Delphi insiders to let us go public with the bankrupt parts maker’s layoff plans. I know it’s not exactly what you’d call Christmas cheer, but imagine how the affected workers feel. This is the presentation that Delphi’s HR department is detailing Delphi’s “Temporary Layoff” (a.k.a. TLO) policy. The nasty bit: after Delphi temporarily lays off a worker, they can cut their pay and change their job when they return, at will. “If you don’t show up to work on the designated date after your TLO, they also consider it a ‘voluntary quit’ (as opposed to what?). It appears that they are already getting a campuswide TLO ready for possibly the end of January for two weeks (including execs), and that we will have a two-week TLO pretty much every quarter until some unspecified time.” Bottom line: Delphi is still going down.
A British eBayer, selling a rather unusual car for the UK, describes one of the many flaws of his Ford Thunderbird 3.8:
SIDE WINDOW SMASHED DUE TO SOMEONE SMASHED IT.
Winner.
As the madness swirled last week, a certain Robert Lutz was being kept well away from the PR-charged atmosphere in DC. But driving Volt/Cruze mules around in circles (instead of to the capitol) isn’t what gets you “Maximum” for a nickname. And with calls for Rick Wagoner to step down busting out all over, reporters are falling over themselves to put a quarter in the Bob Lutz quote machine. Yesterday we were treated to Lutz’s opinion that Wagoner is the “best CEO he’s worked for,” and today there’s even more hilarity in the Detroit Free Press. “These are somber, serious economic times — but it’s still hard to hang up from a 10-minute phone chat with Bob Lutz without chuckling,” writes Freep columnist Tom Walsh. And boy, he isn’t kidding. “If Congress wants a sacrifice, it should be me,” Lutz told Walsh. “I’m older and I’ve made politically incorrect remarks about global warming, so it should be me.” Unfortunately, Lutz didn’t spend the whole interview doing tongue-in-cheek corporate samurai shtick.
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