GM touts their new Chevrolet Malibu as "The car you can't ignore." I've driven the new ‘Bu. It's a handsome, well-built, thoroughly competent machine. As good as it is, Chevrolet's mid-size sedan will only remain psychologically inescapable as long as GM sustains the car's $150m ad campaign. To suggest otherwise ignores the quality and strength of the ‘Bu's competition. It's yet another example of GM's mindless arrogance. In fact, Chevy's first hit in years is already in deep trouble, as I discovered down at the dealership.

Sitting in the salesman's cubicle, waiting for the Malibu demonstrator to return, I watched a customer vent his ire. "I am NOT satisfied," he yelled at a manager sheltering behind the reception desk. "It's a new car. I've been back here FIVE TIMES and I am NOT satisfied."

This confrontation could have happened at any dealership. J.D. Powers, Consumer Reports and TrueDelta have documented GM products' increased quality and reliability. But the way the dealer's staff glanced at each other during the customer's diatribe told me that the distraught buyer's remorse was neither unexpected nor unfamiliar. Worse, I observed a frisson of fear spread across my fellow customers, as they contemplated what could- maybe even has- occurred to them.

Even if we assume that the new ‘Bu represents a new dawn for the brand, Chevy's past is a recurring nightmare that will not fade away. Call it import bigotry or sensible self-protection, but GM's marketing campaign should have addressed this problem head-on. Instead, they sent a subliminal message that their latest next big thing is good enough to convince customers to ignore Chevy's ignoble legacy of customer alienations. It's an intellectual leap that GM's marketing maven are making on their own.

A minute later, I asked the middle-aged Mom emerging from her Malibu test drive what she thought about the car. She was all smiles. "We came down to look at an Impala," she said, pointing to a picture in a discarded ad resting on the salesman's desk. "But this is one sharp car."

Cannibalization is one of GM's less-discussed afflictions. For example, the domestic automaker basks in the success of its Lambda-platformed crossovers. Yet many if not most of these sales came straight out of the hide of their more profitable SUV business.

If the Impala intender above clicked over to TrueDelta to compare base vs. base, she'd find that the new 'Bu is $1568 cheaper than the Impala. With incentives, it could soon be a wash. She'd also discover that the new 'Bu is just $807 more than its sister-under-the-skin, the Saturn Aura, and $364 LESS than Pontiac's platform sib, the slow-selling G6. Clearly, the new, better-built, sharper-looking Malibu will steal sales from other corners of the GM empire. 

Model and brand overlap is a luxury the Malibu's maker can't afford. If GM is to prosper/recover from its dramatic downsizing, it must attract NEW players to the table. Reshuffling the deck for the same old diehards won't do it- especially if the old cards were better stacked in GM's favor (i.e. more profitable) than the new ones.

Let's face it: the buyers most able to ignore the new Malibu- contented Accord, Camry and Altima buyers- are the ones GM needs the most. To be fair, the new Malibu is a highly credible alternative in a highly competitive genre. But…

GM didn't make enough Malibus. The dealer I visited had one Malibu. They'd sold another. Only two more were due this month. Next month, they MIGHT get four. Hell, even their own ad agency seems to be having trouble getting them; all the spots I've seen use computer-generated cars. 

This is the Mother of All Screw-Ups. Imagine you're a transplant-type who suddenly decided to shop for a mid-size car. You stop by the Chevy dealer for the first time in a decade- or ever- to clock the new ‘Bu. No demo car. No cars on the lot. All (and by that I mean a handful) of the cars coming are pre-sold. What are the chances you'll wait?

The competition won't. Not only do Honda, Toyota and Nissan (not to mention Ford and Chrysler) already have plenty of stock at all trim levels and colors in this class (duh), but they aren't about to be caught flat-footed by GM's nifty newbie. Look for them to amp-up their marketing campaigns and/or offer discounts– as Chevy dealers charge full sticker (just because they can). And then, soon, the 'Bu's foes will counter-attack with even better cars.

You only get one chance to make a good first impression. Chevy's blown it. Given the aforementioned bad vibes dogging both GM and Chevy, this is an irrecoverable mistake. The Malibu hype will die down. The new Chevy will be a solid seller when supplies ease, but it will have lost the chance to capitalize on GM's $150m marketing mitzvah to build the momentum it needed to provide The General with a breakout success.

So, GM finally built a commercially viable car, yet failed to make a meaningful marketing campaign, sort out its model lineup or assure adequate supplies. The new ‘Bu reveals the fundamental problem plaguing GM, the deficiency we've highlighted since this series began: a bloated, unfocused and incompetent bureaucratic structure. Until and unless GM corrects this fault, they're doomed.  

Now that the dust has settled on the last of the United Auto Workers’ (UAW) contract negotiations in Motown, the other shoe has dropped. All three domestic automakers have announced new lay-offs and plant closings, atop already extensive cuts. Chrysler killed half-a-dozen models. Ford has shuttered plants and signaled that “things might change” if “things get worse.” GM has eliminated several third shifts. So what’s next? Basically, we’re looking at an auto industry version of “Three Bears.” GM wants to stay big, Chrysler wants to get small, and Ford wants to be “juuuuuust right.”

Chrysler's cupboard is bare, there's nothing much in the pipeline and they have nothing to speak of overseas to lean on. All they have is a few decent entries in a handful of profitable niches. In line with their new owner's philosophy (a.k.a. strip and flip), Chrysler will continue to reduce production and kill products. They want to cut Chrysler's product line down to the vehicles they can sell profitably at the volumes they can move and then get acquired or go public. Done.

Look for Chrysler to try to get the 300s, the minivans and Jeep down to profitable volumes. The Ram and the Sebring/Avenger will survive even if they have to give them away; owning a volume product in a major market segment looks good to a buyer, profit or no. The multi-billion dollar question is how much is Chrysler spending on developing new products? The answer would give us a better idea of when they’re planning on selling their stake.

Meanwhile, Ford's market share has been dropping like a stone– which is no surprise to anyone. The fall from grace isn't “good,” just expected, as Ford has vowed to cut way back on their fleet sales. Clearly, Ford’s strategy is to downsize to a profitable volume and call it good. To this end, they’ve emphasized the need to improve flexibility in manufacturing. Details are sketchy, but part of the UAW agreement mandated/allowed for just such an investment. Hopefully implementation will involve multiple body types on one line, Honda-style, rather than just vomiting forth the usual badgeneered clones from one factory.

Shrinking down to a profitable volume– and trying to hold the line on price– looks like a winning strategy for The Blue Oval Boyz. But the question everyone is asking– and no one can answer– is “will it work fast enough?” There’s nothing left to hock. If shrinking doesn’t work, and work soon, Ford will be booking some federal court time for a Chapter 11 petition.

While The General didn’t wrest the concessions from the UAW that the later-negotiating pair secured, GM still got most of what it wanted– offloaded health care benefits, a new two-tier wage scale– without having to promise much. That said, GM has been doing its utmost to hold onto market share: upping incentives, investing in terminally ill brands, putting-up with duff dealers, etc. Why? 

Is GM pushing sales to keep their bloated dealer network afloat, or simply attempting to drive one or both of their domestic competitors to the wall? Chevy is rooting for biz down-market (trading punches with Hyundai/Kia), well below where Ford seems to be aiming their name brand. GM’s leaving the competition with the Dai-san (Honda, Toyota, Nissan) to the old “premium” brands, and Saturn. Cutting brands and dealer networks has been back-burnered until the profits return– when the problem can be ignored.

GM looks the closest to healthy right now, which is both good and bad. They are the least likely to run onto the financial rocks, but if one of the other two reinvents themselves or survives a trip to bankruptcy court, GM will be playing by the old rules in a new world.

While these are confusing times, a few things are certain. First, The Big 2.8 are going to lose more market share. A fair amount of their current share is created by fleet and fire sales– that have devastated profitability without driving back the competition. To make money going forward, these have to go. 

Second, The Big 2.8 are off the radar for roughly half of the American new car market. The Motown manufacturers hope that profits can be made from the half of the US market still “in play.”  It's a viable stratgey; half of the US market is still a huge pool. But it leaves the Detroit boys playing a zero-sum game. Any increase in sales for one comes out of the hide of another.

This is a problem; the sum of the shares that the 2.8 are counting on grabbing literally will not add up. If 50 percent of the market is considered “in play,” the total of the 2.8s’ expected shares is likely closer to 60 percent. Somebody’s going to come up short.

In the battle for the American automotive market, Detroit’s fighting for its life, rather than supremacy. The truth is that the so-called domestic automakers are under siege; their non-union competition forced them inside the castle walls a long time ago. And while Toyota, Honda and Nissan are busy unleashing new and improved vehicles to vie for U.S. customers’ patronage, Ford, GM and Chrysler are busy retrenching, regrouping and re-arming, dreaming of both past and future glory. And when they’re not doing that, they’re tearing each other to pieces.

The most recent and obvious evidence of Detroit’s internecine perfidy: Chrysler’s decision to cut 12k jobs, kill models and downsize production just five days after the United Auto Workers (UAW) ratified their new contract. Never mind that the move reveals the UAW’s complete betrayal of their own rank and file, who would have never ratified the Chrysler contract (if indeed they did) if they’d known of the wholesale slaughter to follow. The more important impact of this [necessary] bloodletting will be on Ford.

Now that Ford’s UAW members have witnessed the fallout from the Chrysler contract, they will never ratify an agreement without iron-clad job guarantees. And if you thought that deep-pocketed, privately-owned Chrysler needed a free hand to downsize production, pity poor Ford; the sickest, most vulnerable automaker in the biz. It’s mortgaged up to its eyeballs, losing market share by the minute and drowning in an ocean of red ink. You can see their cash burn from Cincinnati. FoMoCo can afford job guarantees like the average pistonhead can afford a Bugatti Veyron.

Could Chrysler have waited THREE WEEKS before swinging their mighty axe, so that Ford could have secured the same sort of no-strings-attached deal for their UAW members? Sure. And there’s only one reason Chrysler CEO Bob Nardelli didn’t stay his hand: to shiv his cross-town rivals. 

If you read the reactions to yesterday’s Ford – UAW deal carefully, you can see the damage the Three-Headed Dog’s automaker has inflicted on The Blue Oval Boyz. "Our goals for this contract were to win new product and investment, to enhance job security and protect seniority,” pronounced UAW Veep Bob King, director of the union's National Ford Department. Yes, well, would the UAW be stupid/brazen/corrupt enough to ask its Ford members to ratify a guarantee-less contract after the Chrysler massacre? Not if you take UAW boss Ron Gettelfinger at his word: "We encouraged Ford to invest in product and people."

In fact, Ford needs to follow GM and Chrysler and invest in getting RID of products and people. They have too many brands, models, employees and production capacity to survive. While Ford’s new union contract includes a huge payment into the UAW’s inconceivably large, eminently lootable VEBA health care superfund– securing the automaker a cost-reducing two-tier wage system– Chrysler has made sure that Ford can’t downsize in time to reap its benefits.

And what of GM? It must be said that GM’s sitting relatively pretty in all this. With the help of the UAW management, they got away with making empty job guarantees to their union workforce (we’ll give plant X the new car– you know, IF there’s a new car). They’re now free to slice production to match demand, and slice they have. Even better, they’re eating Chrysler and Ford’s lunch. 

Check out last month’s sale figures. Compared to October '06, GM sales rose by 3.4 percent. Did the market expand? No. Did Toyota, Honda or Nissan sales slip, indicating that The General’s much-hyped new or revised products harvested conquest sales from the transplants? Hell no. The salient stat is that Chrysler and Ford sales plummeted. While there’s no hard data on this, common sense suggests that American car buyers who tend towards domestics (a well-documented predilection) are switching their patronage to GM.

We’ve mentioned that old joke about the “buddies” chased by the bear who realize that they only have to outrace each other to survive. Well, there you go. GM’s in the lead and Chrysler’s tripped Ford. Which is all very well and good for The General and The Dog, but Ford still has a secret weapon (that nobody sees): bankruptcy. While GM and Chrysler have dropped some of their union-related baggage through clever negotiation (i.e. paying off the UAW VEBA-wise), Ford could lighten even more of their load through Chapter 11.

I don’t mean UAW pay or benefits; as [non-co-opted] union members maintain, that’s not the real issue. I mean dealers. All three so-called domestics are hamstrung by their bloated dealer network, which prevents them from consolidating models and killing brands. If Ford files, they can ditch their duff dealers, drop bad brands, beat-up (not remove) the UAW and emerge a far leaner and meaner carmaker than either Chrysler or GM. 

Of course, none of this gets rid of the "barbarians" pounding on Detroit's gates.

Autobild reports that the soon-to-be-Porschefied Volkswagen Group is adopting a low-price strategy for the US market. Beginning in 2011, VW US will sell several relatively cheap, not-for-Europe models: a $20k frumpified Passat, a $15k Jetta and a $25k Passat-sized SUV. (India and China will also be blessed with these Vee Dub strippers.) VW prays hopes this "mid-term strategy" will boost their American sales from last year's 235k units to a cool million vehicles per year. Autobild reckons this plan creates a conundrum: how to prevent gray-market exports to Europe? How to protect VW's international brand values? The magazine recommends introducing a new low-price brand (e.g. Toyota's Scion and Renault-Nissan's Dacia). Meanwhile, in Tokyo, VeeDub's upmarket sib has introduced the new, slightly-larger-than-Mini-sized A1. Badge-engineering alert! Although the new Audi A1 shares its atrocious gaping grille-mouth with the Q7, it sits on the VW Polo platform. The model also introduces Audi's new soft-touch, synthetic cow hide, trademarked "velvet leather." As Grace Jones will tell you, it just doesn't have the same ring to it as warm leatherette. 

U.S. auto sales showed their first overall increase since May, with a 1.2 percent gain over last October– if you don't adjust for selling days. If you do, (as does BusinessWeek) then sales were down about 3 percent.. The good news: sales growth by GM, Toyota, Honda, and Nissan. The bad news: Ford and Chrysler weren't so fortunate (as in very, very unfortunate). Bloomberg attributes their sales tumble to the popularity of small cars and car-based SUVs (aka CUVs), one or the other (or both) of which are poorly represented in Chrysler's and Ford's lineups. Here's how the top seven fared overall:

Nissan – up 13%
Toyota – up 4.5%
Honda – up 3.8%
GM – Up 3.4%
Hyundai – down <1%
Chrysler – down 8.9%
Ford – down 9.5%

We'll have the detailed By The Numbers breakdown for our bellwether models next week.

It is time. You've nominated 136 candidates for The Truth About Cars' (TTAC) recently rechristened “Ten Worst Automobiles” awards. TTAC’s stable of underpaid and overeducated scribes surveyed the damage and did their duty: they've winnowed the roll call of automotive abominations down to the terrible twenty. Now it's your turn to tell the truth about cars. Go to the bottom of this post and vote for ten vehicles you consider worthy of public recognition as TTAC's Ten Worst for 2007.

Some Ten Worst nominees were as predictable as an episode of Scooby Do– and they would have got away with it too if it weren’t for those meddling pistonheads! A couple of choices seemed designed with TTAC's Ten Worst awards in mind. And here they are: the bad, the ugly, the worst of the worst.

Chevrolet TrailBlazer / GMC Envoy / Isuzu Ascender / Saab 9-7X (2006 Winner – 9-7X)

Chevy Aveo (2006 Winner)

Chevrolet Cobalt  (2006 Nominee)

Chevrolet Monte Carlo (2006 Winner)

Chevrolet Uplander (2006 Winner)

Chrysler Aspen (2006 Winner)

Chrysler Sebring

Dodge Caliber

Dodge Nitro

Ford Focus

Hummer H2 (2006 Nominee)

Hummer H3

Jaguar X-type (2006 Nominee)

Jeep Commander (2006 Nominee)

Jeep Compass (2006 Winner)

Lincoln Mark LT (2006 Winner)

Nissan Armada

Pontiac Grand Prix

Saturn ION

Subaru Tribeca (2006 Winner)

To assist you in your sacred duty, lend the Ten Worst selection process an air of legitimacy, amuse you and take us to the requisite 800 words, here are guidelines for assessing each finalist. 

Value (price, content, depreciation) – Does it scream "RENTAL UNIT?" Would you be better off in the long run if you just tossed your money down a sewer grate rather than buying this vehicle?

Market segment suitability – How well does the Ten Worst finalist stack up against other vehicles in its class or price range? Is there any real justification for its existence– other than placating dealers or keeping a factory running to satisfy the terms of a UAW contract?

Reliability – When you hear someone talking about "Total Recall," do you think about Arnie's magnum opus or this car? Would you buy one only if you could unload it before the 50K mile mark? Would you let your teen-aged daughter drive one across town at 1 AM? 

Build quality – Does the wiring look like a public service announcement for The Duct Tape Council? Can you see the panel gaps from low-Earth orbit? Was the trim applied by Salvador Dali after a three-day bender?

Quality of materials – Are the materials better suited for a city bus than a private vehicle? Would you rather touch a leper than a latch? Is the faux wood/aluminum/carbon fiber as convincing as Britney Spears speaking at a Mothers Against Drunk Driving convention?

Styling – Does it look like it was designed by three different blind people? In three different countries? Communicating via smoke signals? From a bong?

Performance/handling – Is the vehicle's zero to 60 performance best measured with a calendar? Does the hubbub under the hood have any correlation with forward motion? Does the car's cornering prowess bring to mind a rutting walrus?

Design – Are the ergonomics egregious? Is there less rearwards visibility than a 747? Is it a parts bin special bereft of anything remotely resembling "special?"  

Desirability– If your company gave you this vehicle as a company car, would you consider changing jobs?  If you had to drive one in public, would you pull a cap down over your face and assume the gansta slouch just to keep anyone from recognizing you?

Je ne sais quoi– That's French for "I know this car sucks, but I can't put my finger on the exact reason it makes me gag every time one passes on the street."

So, armed with these analytic tools, we place TTAC's Ten Worst in your capable hands. When you're ready, click at the bottom of this post and vote for up to 10 selections to be named the crème de la crap of the auto industry. (No repeat voting. Violators will be forced to drive the worst of The Worst for one week.) Please feel free to justify your decision and/or lobby your car-crazed cohorts below. Voting closes at midnight, Saturday 27 October. We'll announce the "winners" on November 1.

As always, RF, the entire TTAC team and I thank you for your participation. Although we use a light-hearted tone here, rest assured we understand the importance of naming and shaming the vehicles that bring dishonor to their manufacturers and disgrace our American roadways. And to those automakers whose products appear here, a message: the truth hurts. If your vehicle is on this list, regardless of short term gain, we urge you to do the right thing. For all of our sakes, it's time for the pain to stop. 

Click here to vote

"Oh, the poor unions!" says Max Fraser, a "2006 Intern" now scribing full time at The Nation. The budding curmudgeon supposes that The Big 2.8 will be the death of the unions (not the more likely murder-suicide). That's because Detroit's robber barons just keep squeezing those wages and benefits. Unfortunately, his explanation of how this is happening, and why we all should be worried is… well, let's just say Mr. Fraser has penned the Chrysler Sebring of rants. In a sweeping example of internally-inconsistent analysis, Fraser manages to blame Toyota and Honda for paying their workers more than UAW guys make– and then urges the UAW, for the good of the workers, to get into Toyota and Honda's factories as soon as possible. Fraser also manages to insult and put down outsourcing, insourcing, rural areas, and the "Third Worldization of the American South." Gee, with all those corporate headquarters in the South (Coca Cola, Nissan, Wal-Mart, Saks Department Stores, Home Depot, UPS, Bank of America, Lowe's, Wachovia, Sprint-Nextel, just to name a few), a $3b biotech industry in North Carolina's world-class research triangle, and the busiest airport in the world, the "Third World American South" sounds like a pretty productive place to me.

Business Week scribe Jim Henry calls them "wallflowers:" cars with obvious charms that have customers lined-up none deep. Now that Chrysler has somewhat kinda hang on we better wait for this union contract to go through before we actually announce anything decided to trim some dealer deadwood, Henry explains the reasons why great cars' sales suck. Why is the Hyundai Azera a drug on the market? "Customers almost have to discover the Azera for themselves. Except when it was first launched, it hasn't had much model-specific advertising." Kia Amanti? Same deal (as opposed to hideous looks and a misguided attempt to take Kia upmarket). And add Daimler's R-Class to that list. As for the Saab 9-5, Henry nails it: "It competes with European heavyweights like BMW and Mercedes-Benz, which have bigger engines, more prestige, more awareness, more of almost everything." Nissan Quest? Styling's too rad. Lincoln Town Car? Ford Explorer? Buyers downsized. So now you know. Oh, one more thing: Henry reckons you should buy one these turkeys also-rans 'cause they're cheap. "That's one of the good things about wallflowers—they are usually very happy to dance if you ask them." Ain't that the truth. 

Last year about this time, we gazed into the crystal ball to predict a few changes in the automotive world. A lot of water's gone under the proverbial bridge since then: Toyota's world number one, the UAW's selling out their membership for a few dozen billion, Ford and Chrysler are attempting turnarounds with leaders who have no automotive industry experience whatsoever and GM Car Czar Bob Lutz is straining his personal credibility beyond breaking point. Well, OK, some things haven't changed. Anyway, with all that's happened in the past year, what does the future hold? Here are some of our predictions.

Hyundai Announces New Model:  Hyundai's Ford division has unveiled its latest offering: the midsized Torino II. Rejecting web reports that the "new" car is merely a rebadged next gen Sonata, Ford's Emperor of the Americas, Mark Fields, stated "The new Torino II resurrects a distinguished name from Ford's past in a bold move that brings an unprecedented level of sophistication to the Ford brand." 

The new model rounds out the Ford line, joining the subcompact Pinto II (built on the Accent platform), compact Maverick II (which shares drivetrain and other components with the Elantra), and the new F-150 II pickup (built on the Veracruz platform). Kia's Mercury division has yet to make any new model announcements. Rumors of a resurrected Lincoln Continental based on the Kia Amanti are unconfirmed.

GM Relocating to Follow Their Market:  In a surprise move late yesterday, GM announced plans to relocate the company headquarters to Mumbai, India. CEO-for-Life Rick Wagoner explains: "Since all of our assembly plants are in India, Thailand, Korea and China, it was only natural that we consolidate our operations in that region, too. This will allow us to get better control of expenses and begin the last phase of our turnaround plan."

GM plans to keep a small staff on floors three and four of the Renaissance Center to handle North American marketing, along with a warranty claims staff on floors five through 68. Nonagenarian Vice Chairman and Product Czar Robert Lutz was napping, and thus unavailable for comment on the move.

Gore Declares War on Environmental Hazard: Nobel prize winner, former Vice President and presidential also-ran Al Gore announced today he was beginning a campaign to limit the use of fuel cells in automobiles. Gore, who won his Nobel for inventing the internet and discovering greenhouse gases, stated that these so-called "zero emission" cars were, in fact, producing dangerous levels of dihydrogen monoxide (DMHO) and releasing it into the environment.

As he explained, once released, this compound collects in large clouds in the atmosphere which block the sun and increase the greenhouse effect.  It is found in acid rain and contributes to soil erosion. DMHO has become so pervasive it can be found in almost all foodstuffs and is even sprayed on "organic" produce, Gore warned. He has made eliminating DMHO from the environment his primary goal for this decade.

Business as Usual in the PRC:  Chery is being sued by Daimler for patent infringement. The suit centers around the rear suspension of the Cherysler 300. The suspension, originally designed by then-DaimlerChrysler, was based on the suspension of the Mercedes E-class. Since Chery's acquisition of the Chrysler division from Cerberus, Daimler claims they have done nothing to modify or redesign the suspension and in fact are expanding its usage to other vehicles.

Daimler legal counsel Max Schwanstüker, who filed the suit, asserted Chery has had plenty of time to redesign the suspension– but chose not to. Chery countered by stating they have indeed redesigned it; as it now includes parts from the latest E-class. The Chinese government has issued a statement saying there have been no patent infringements by domestic automakers, nor can there be.

UAW Seeks New Identity:  The United Autoworkers Union (UAW) is changing its name. Since their membership no longer includes any autoworkers, the UAW realizes they have to change with the times. In a press release, the UAW stated, "Unlike the Teamsters Union, which has nothing to do with horse teams, sports teams or any other kind of team, we want our name to remain relevant." Some of the names they're considering: Minimum Wage Workers Union (MWWU), United Service Industry Workers Union (USIWU) and Busboy, Waitress, Casino and Daycare Workers International (BWCDWI)

Motor Trend Modernizes Content:  Motor Trend (MT) disclosed plans to publish content consisting only of special advertising sections. MT publisher Beefy McBigmac justified his decision by saying, "Surveys show our readers don't know the difference between what we write and the advertisements, so why not save a few editorial bucks and let the advertising agencies write all of our copy? This way we can afford to keep giving away subscriptions while other automotive magazines are having to convert to on-line publishing." 

In an unrelated story, Motor Trend announced their Car of the Year is the all-new Hyundai Ford Torino II.

GM Death Watch Reaches Milestone: TTAC's GM Death Watch Series has reached a milestone. This week sees the publication of The Truth About Cars' GMDW 1,000. Publisher Robert Farago said, "That f-ing company has more f-ing lives than a f-ing alley cat. Just when you f-ing think it's going down for the third f-ing time, someone throws it a f-ing life preserver and it just keeps f-ing floating along, hanging on by its f-ing fingertips."  Farago is certain GM– which is now the world's sixth largest automaker after Toyota, Honda, Nissan, Hyundai, and Chery– can't last much longer.  "We're in it until the bitter end – either theirs or ours."

The "new" Ford Focus rests atop eight-year-old underpinnings. But the car's PR campaign uses cutting edge (so to speak) New Media techniques. Cnet.com reports that FoMoCo's launching the '08 Focus with the spin industry's latest jargoneriffic widget: a Social Media News Release (SMNR). Ironically enough (at least for Nissan fans), the SMNR was created by SHIFT Communications as "a viable new format to spark and cultivate online conversations about a product." In case you can't be bothered to click through to a release on the hot new Focus, the non non-viable digital press release contains "boilerplate statements," loads o' links, podcasts, a webpage or five, links to old stories, pre-approved quotes, eye candy photos, graphics and YouTubeage. We were expecting some new level of interactivity– IM or webinars with people within the company, connections to other journalists or links to Foci forums, but no; it's same old you-know-what is a new wrapper. Clearly, the "fourth wall" between automakers and their customers is still bricked-up. Perhaps Ford's new marketing maven from Lexus could have a look at this…

Ford Model T. Volkswagen Type 1. Tata People's Car. Tata what? Next fall, Indian automaker Tata plans to introduce a $2,500 car to put India's masses on wheels, just as Ford and VW did in their home countries. The New York Times reports that Tata is one of several automakers who want a piece of the entry-level pie in what will soon be the world's fastest-growing car market. (Maruti Suzuki currently controls more than 50 percent of that market, with models as low as $5k.) As Tata moves even further down market, they're joined by Honda, VW (Skoda), Toyota, Renault-Nissan and Ford. While critics are worried about the safety of such cheap cars, the automakers all say they'll meet local safety standards (how reassuring is that?). Needless to say, environmentalists are expressing concerns that more cars on India's roads will exacerbate India's air pollution problem.  

The American automotive market offers just three inline six (I6) engines. First and foremost: BMW's 3.0-liter unit. Devotees will find the propeller people's sublime I6 in the 328i and 528i, and in turbocharged form, in the 335i and 535i. Otherwise, there's GM's excellent 4.2-liter I6 found in the Trailblazer, Envoy and Saablazer 9-7x. And don’t forget Volvo’s new 3.2 and 3.0L I6 engines, used in the 2008 V70/XC70/S80/XC90 and the baby Land Rover. These sweet, smooth, silky engines are all that's left of a once-proud breed. The GM engine will probably die along with its host SUV in a few years, just as Jeep dropped its 4.0-liter inline six with the passing of the Wrangler. Mercedes ditched its straight six over a decade ago. Jaguar used to sell a six cylinder inline engine in the classical XJ6. And of course there were three outrageous examples from Toyota: the 4.5-liter straight six in the Land Cruiser and two different 3.0- liter six pots holstered by the Cressida, Supra, Lexus SC300 and IS300. Why has the I6 gone by the wayside? Lots of reasons. A V6 is a lot more compact, and most manufacturers use engines across their entire brand lineups. That means a modern V6 engine has to fit both transverse and longitudinal applications; Nissan, Toyota, GM, VW/Audi twist their V6s by 90 degrees. Hopefully the future will hold more I6 engines, if only because they tend to be so full of character, well balanced and smooth. Until then, you can pick up your own straight six on the cheap in a used Suzuki Verona (which even mounted it transversely).

[Click here for the technical differences between I6 and V6 engines]

Back when Honda was looking to launch their hybrid Accord in the US, the marketing mavens noticed that the gas – electric version was the fastest arrow in the company's quiver. They proposed pitching the gas – electric Accord as a green hot rod (skinny tires and all). Honda's top brass KO'ed the idea for failing the "if it's fun, it can't be good for you" PC test. The hybrid Accord went on to sell… very poorly. So it's no surprise that the AP (via the Detroit News) reports that Honda's showing-up at the Tokyo Motor show with a hybrid sports car concept. The CR-Z not only steals a letter from Nissan and displays a taffy pull version of Volvo's corporate nose cone, it also boasts "the essence of the sports car." The man behind the design-speak, Honda engineer Tetsuji Morikawa, says Honda will sell the CR-Z "in the near future" (about the time the Chevy Volt appears, presumably). The AP reporter clearly hasn't driven the hybrid Accord; he suggests that hybrids ain't got no torque and their greasy bits preclude pistonhead packaging. "The CR-Z comes with a new hybrid system developed by Honda whose breakthroughs allowed designers to get around such restrictions." Never mind the dressed-to-impress sheetmetal, we want to know about those breakthroughs…

The Canadian dollar is back. After a thirty-year slump, the “loonie” is now staring eye-to-eye at the American greenback. The strong Canadian economy, the worldwide thirst for oil, and George Bush using The Fed as a money tree have all converged to push the Canadian dollar skyward. The meteoric rise of the dollar has given Canadians incredible arbitrage opportunities with American products; especially cars. The Canadian car industry ain’t pleased– and for good reason.

In 2006, Canadians imported 112k new and used vehicles from their neighbors to the south. That stat represents over 50 percent growth in US imports over the last two years. The crux of the problem: many retail prices in Canada are based on an exchange rate more appropriate for the Clinton era. To wit: Buying a Nissan 350Z Coupé in the United States will cost you $29,000. A similarly optioned car in Canada will cost – wait for this – $51,000.

Now, converting the US price of $29k at a rate of about 1.06 yields $30,740. Throw in $2k for shipping (you can drive it up yourself on a temp plate), $1800 in import duties (which you don’t pay on any vehicle assembled in the NAFTA zone), $5,200 in taxes (assuming Quebec and Ontario’s rates) and you’ve pocketed a cool CA$13k by buying your new Z stateside.

The downside, of course, is that Nissan, like most manufacturers, doesn’t honor warranties in any country other than the country of purchase. One notable exception (of course): Toyota. The Japanese automaker honors warranties all across North America. It’s good for the whole family, too: Lexus, Scion, Toyota and the newest addition, Subaru, are all included. Still, if you’re not expecting 13 grand’s worth of warranty repairs on a reliable car like the 350Z, the deal is hotter than a dancing bobcat with its ass on fire.

The other problem is red tape. In order to get a US-spec vehicle on the road in Canada, it must first be admissible for import. The government has printed a list of such vehicles on http://www.riv.ca. Conspicuous by their inadmissibility are the Pontiac GTO and the Mistubishi Lancer Evolution IX, which have failed Canadian bumper and emissions tests. Export papers need to be filed at U.S. customs, and import papers at Canadian customs, including a manufacturer’s letter stating that no outstanding recalls apply to the vehicle in question.

Once imported, a vehicle has to be converted to display kilometer-based readings, and have daytime running lights installed. Finally, the vehicle must be inspected and (possibly) emissions tested before it can be registered in a province of Canada. Other annoyances may apply. For example, if the vehicle comes from a state with lax tint and modification laws, you might end up needing to make cosmetic adjustments as well.

The fact that new cars start so much lower on the MRSP ladder in the U.S. also has ramifications in the used market. A 2005 Honda Accord EX-L with 14k miles will fetch about US$18k stateside. The same car will cost $23,400 in Canada. Converting 18-grand to Canadian and applying taxes will give us a car that costs $21,050. The best part? Since the Accord is assembled in Ohio, it’s a NAFTA car! On savings of $2,350, the day trip to upstate New York pays for itself. Even greater savings can be had on big-time depreciators like the Cadillac CTS-V or the Porsche 911 Turbo.

I picked the 350Z scenario because it’s a more extreme example of manufacturers being too greedily lethargic to adjust their Canadian pricing. Driving.ca recently quoted an average difference to be about $5,800 across international lines in one of its articles. The difference is still important enough to encourage a steady, increasingly large parade of vehicles across the border.

The government of Canada is hemming and hawing about ways to protect Canadian dealers while in some ways paying lip service to NAFTA. For their part,  manufacturers are now threatening U.S. dealers with a loss of franchise if they continue selling to Canadians. Meanwhile, the market is busy reacting predictably. For those too lazy to go through all the hoops, vast arrays of brokers and importers have put out a shingle and are waiting for your business.

Eventually, something will break. Either the manufacturers will adjust Canadian pricing, outright ban the sale of cars in the United States to non-residents or the Canadian government will impose an automotive tariff.

The medium-term outlook for the U.S. dollar is particularly bearish. Therefore, there is no reason to expect an abatement of any kind in Canadian imports. It’s a strange role reversal for many Americans, to think their country has become Canada’s automotive outlet mall. Quite soon, Canadians will be making fun of that “funny, two-tone money,” too.

The previous gen C-Class was not Mercedes’ finest hour.  Chief amongst its non-virtues: base engines that offered little in the way of functional power, refinement, fuel efficiency or brand faithful character (e.g. the 1.8-liter blown four). The fourth gen C300 (W204) put paid to that– and how. In fact, the new C may have finally have broken the bigger-is-always-better mold that the German carmaker has deployed to lure Benz buyers up the ownership ladder. Ah, but does that mean that the new, more highly-horsed C350 is so superior to the C300 as to steal stars– and sales– from its cheaper stablemate?