When a big storm comes, even the best-prepared boats get knocked around. But while the Big 2.8 take on water like a sieve, Toyota has managed to gain market share by simply avoiding double-digit losses. Unsurprisingly ToMoCo’s trucks are doing worst, dropping 17.6 percent but improving over July’s dismal performance. On the car front, the Yaris is booming with 20 percent higher sales than last August, and Camry is up 3.3 percent. But sagging Corolla sales drag Toyota’s overall car sales down 3.4 percent from a year ago. Scion’s skid has leveled off, recording almost exactly as many sales as in July. Lexus follows the ToMoCo trend of hybrids up, everything else down, with a 9.8 percent decrease in cars and a 7.8 decrease in trucks sold in August. Between its brands, Toyota now sells nearly twice as many hybrids as it does Scions, with 19,529 sold in August and 185,051 sold on the year to date. The only way to boost sales there is to increase production. Again. Still.

Car Guy: 1. A person that lives and breathes cars; can tell you not only the make and model of every car on the street, but the displacement and power ratings as well. 2. A car enthusiast that values performance over practicality, comfort, reliability and efficiency (see Alfa Romeo Owner). For today’s QOTD purposes, lets stick with definition number two. Good? That said, I’m fortunate enough this week to be blasting all over Los Angeles in a Pontiac G8 GT (that’s the one with the 6.0-liter 361 hp V8 — more later). In my eyes, the Pontiac from down unda is a car guy’s car. Potent, fairly crude, not so hot on gas and a genuine thrill to drive. This morning (doing about 90 mph up a 6% grade) I passed a New Beetle Convertible. It had an orange top and matching orange rims. My gut, reptilian brain reaction was to smash it off the road. Who would drive such a dorky buggy? But is the Bug that J Mays penned any less of a car guy car than a Toyota Corolla/Camry? What about a (perish the thought) minivan? Or, the press car I traded last night for the G8, a Lincoln MKX? Yeah, the Ford Edge with 50 Cent’s teeth. I’m going to stick with the sherbet New Beetle. You?

If you want a preview of how your elected representatives are going to approach the $50b Detroit bailout (a.k.a. “Retooling for Tools”), you could do worse than read this Washington Post diatribe by economist Steven Pearlstein.  “The Road to a Bailout They Don’t Deserve” begins by giving The Big 2.8 a right royal pasting. “Even before top industry executives arrive in Washington later this month to lobby for their program, General Motors’ vice chairman, Robert Lutz, who never misses an opportunity to put his foot in his mouth, was telling reporters in Chicago last week that the industry ‘deserves’ government loans because of all the challenges that have been inflicted upon it. In fact, it’s hard to imagine an industry less deserving of government help.” Other barrel: “Here are three companies that for decades failed to produce cars that were well designed, well produced and exciting to look at, that fought tooth and nail against efforts to require greater fuel efficiency and, until recently, did too little to bring wages, benefits and retiree costs in line with competitive realities. And while they whined for years that it was unfair trade that put them at a disadvantage, Toyota, Honda, BMW and other foreign transplants came along to prove that it is possible to produce quality cars at affordable prices in U.S. factories while offering decent wages and benefits.” And just when you think Pearlstein’s going to lower the boom, he says giving Detroit the money is “probably the wise thing to do.” Probably? How great is that?

Most hybrid/EV companies run on deposits. With most “game-changing” products still deep in development, firms often squeeze deposits out of prospective customers to keep cashflow coming before their cars come to market. Not so with Toyota. The LA Times blog notes that Toyota has asked its Palo Alto, CA dealer to stop taking $500 deposits on plug-in Prius models that are still several years from launch. “We asked the folks at Magnussen (Toyota of Palo Alto) to back off a little bit,” Toyota spokesman Irv Miller said. “Let us get our product to market and figure out where we’re going with it before we start putting the cart in front of the horse.” Magnussen has refunded all 25 cash deposits it received, and has created a free waiting list that has already grown to 44. But Toyota’s warning to Magnussen isn’t stopping other Toyota dealers from collecting cash deposits. “I’ve got a few people in town who wanted to come in and leave deposits” on a plug-in hybrid, says Matt Meyer, Sales director of Toyota San Louis Obispo. “I’m not going to tell them ‘No,’ because I don’t tell my customers ‘No.'” Both dealerships say the deposits are fully refundable, but Toyota could still go after San Louis Obispo with a cease-and-desist. That Toyota is trying to reign in hype rather than spur it on is telling. Not only does it show that its future products will face astronomical demand, it also proves that short-term cash is not worth even a few possibly disastisfied customers. Contrast this approach with Chrysler’s un-product EV hype for a quick lesson in how white-hot demand for next-gen powertrains should and should not be exploited.

I prefer to buy my shopping from a company in the UK called "The Co-op." It's an ethical supermarket, which invests its profits into schemes which benefit society (says them). This got me thinking, would you NOT buy a car from a company for moral reasons? Henry Ford I was a raging anti-Semite, Toyota overwork their staff, Nissan are bullying a small company to relinquish www.nissan.com (despite Nissan computers traded as "Nissan" back when Nissan was Datsun) and Volkswagen was borne of a brutal dictatorship. Maybe you can't bear the thought of your money going to GM to fund their outrageous executive pay schemes? Or maybe there's a company who you LIKE to buy from because they support a cause you like? Do morals or some other personal belief come into your car buying habits?

Despite the economic downturn in North America, the future looks bright in BRIC (Brazil, Russia, India and China). So bright, in fact, that there's been an almighty shift. According to Reuters, Toyota has upped global sales stats by 2.2 percent. The increase further cements their number one slot worldwide. That's because GM's global sales have contracted by three percent, trailing Toyota by 278k units. [Note: GM "gooses" its figures by including minority-held joint ventures.] Volkswagen has grown by an astonishing 5.8 percent. As Ford's sales have shrunk by six percent, they've surrendered third largest automaker props to VeeDub. Further commendation goes to Hyundai for increasing sales worldwide by a whopping 10.8 percent, scooping fifth place in the global ranking.

For some reason, Automotive News [AN, sub] felt compelled to write an op ed on Detroit's desire to hoover-up $50b in low-interest federal loans. As you might expect, the automotive news org of record is highly conflicted. So much so, the piece descends into double negativity by the second sentence. "Much of the political buzz about the federal government providing as much as $50 billion in low-cost loans to the auto industry can be chalked up to election-year ebullience. That doesn't mean it won't happen. But before automakers and suppliers cash any checks, there must be a better understanding of the process and any strings that might be attached." Ya think? Anyway, get this: AN supports the loans as long as Honda and Toyota are included– even though "it's hard to imagine that Honda or Toyota would borrow money from the U.S. government." But if the feds don't make an offer the transplants will refuse, "the loans would be nothing more than a Detroit 3 bailout. That would be a questionable use of tax dollars, even in an election year."  

Of all the failures that have led GM to the brink of bankruptcy, the automaker's failure of imagination is the most profound. Never mind the plug-in electric – gas hybrid Chevy Volt. How about conjuring a vision of a company with two or three tightly-focused brands that each produce a handful of distinctive, class-leading and profitable vehicles, that markets them with relentless focus, and stands behind them with a national network of honest, efficient and courteous salesmen and mechanics? Whatever else Car Czar Bob Lutz can say about GM's product strategy, that ain't it. Which begs the question: what does The General want to do with U.S. taxpayer’s money?

The proposed cure is symptomatic of the disease. Like General Motors’ endless, target-less turnaround, the automaker’s plans for low-interest federal loans are utterly vague. GM won’t disclose exactly how much federal money it wants, or what they want to do with it. “We know the legislature authorized up to $25 billion," GM spokesman Greg Martin told the St. Louis Post-Dispatch. "But the amount that could really make a difference likely is much higher.”

Of course, that all depends on who gets how much and what Martin means by the phrase “make a difference.”

If GM wants a share of the proposed $25b in federal loan guarantees to subsidize production of the company’s “game-changing” plug-in Volt, six to ten billion ought to do it. Free marketeers may wonder why American taxpayers should subsidize the producer (GM) rather than the consumer (a buyer of ANY vehicle that meets a certain mpg rating), but hey, Michigan is a "battleground state." American votes jobs are on the line. 

Did I say $25b? In the run-up to and (especially) including the Democratic and Republican national conventions, Detroit has been lobbying pols to increase the federal tax cash to $50b. Michigan Senator Debby Stabenow hinted that even more federal funds might be needed (a lot now, a lot later). This desperate doubling down stripped away any pretense that the supposedly eco-friendly federal loans will pay for Uncle Sam's green dreams. It’s bailout bucks, pure and simple.

Well, not so pure and not so simple.

The $25b loan program is part of last year’s Energy Bill. Your elected representatives mandated that the funds be used to develop and build fuel-efficient vehicles. To channel these loans to The Big 2.8, applicants (supplicants?) must use the low-interest (4.5 percent) loans to re-tool U.S.-based production facilities to manufacture gas-misers. The bill also stipulates that The Department of Energy– the agency charged with steering boatloads of Benjamins to Motown– must give “priority” to assembly plants that are at least 20 years old. (Toyota and Nissan have one qualifying plant each, and they don’t want/need the money).

Of course, federal programs are almost infinitely… mutable. Even though the Energy Bill’s wording seems clear enough, Detroit’s spinmeisters are already pointing out that the final rules are yet to be written. (The final definition of applicable vehicle types should be a fun read.) Taxpayer grumbles about federal favoritism aside, dumping more money into this part of Uncle Sam's trough will be easy enough.

Assuming (as we must) that significant federal funds will flow into GM’s new product development, it should be remembered that the tax money will replace GM cash already allocated for that purpose. GM can then use the [former] development money for housekeeping: union buyouts, unconscionable executive compensation, Delphi's pensions, etc.

So, what’s the bet that the $25b to $50b (to whatever) loans won’t do any damn good? And by “good” I don’t mean that GM will end-up with electric Volts or gas-miserly Cruzes. I mean what are the chances that our tax money will provide anything more than a temporary, ineffectual band aid for GM’s arterial spray of red ink? 

Even if you gave GM a blank check and said “Here, whatever it takes. Build something that will kick the imports (the other guys’ imports, not yours) ass,” they couldn’t do it. Or do it often enough, what with eight brands selling over 40 different(ish) products.

Heads up feds: tight money has not been– nor is it now– the bane of GM’s existence. The General’s goose was cooked by managerial and union greed, sloth, arrogance and, above all, bureaucratic bungling. As anyone who’s ever worked for a company with its head up its ass will tell you, giving copious amounts of fresh capital to execs in charge of a dysfunctional corporate culture to “fix” their business is like trying to extinguish a log fire with gasoline.

If we used our $25b to buy out every GM senior manager and union worker currently employed by the company, and then let the new guys get on with it (with performance-related pay), GM might dodge the bankruptcy bullet. Or, alternatively, embrace C11 as the best way to create a sustainable American automaking endeavor. In fact, the new team would do whatever they'd have to do to survive. And if they didn’t, they wouldn’t. Imagine that.

The Detroit Free Press reports that early August sales estimates show a 14.4 percent drop in new metal moved. But don't turn off your pacemaker yet; the biggest shocker is that Detroit is bearing the overwhelming brunt of the downturn. Estimates from Edmunds show that Chrysler sales dropped 34 percent, GM slid by 27.5 percent and Ford endured a 16.3 percent drop compared to August a year ago. Toyota continues to shed sales but grow market share, slipping by half the industry average at 7.2 percent. The winners in August were Honda, which posted a 0.9 percent increase, and Nissan which defied the market to bump sales by 2.3 percent. On the whole, the market appears to be picking up slightly, with a 13.1m seasonally adjusted annual sales rate (SAAR) up from 12.6m in July. With consumer confidence rising in August, the overall economy appears to be taking its Prozac, but don't expect an auto sales turnaround this year. GM's sharp losses show that even with once-popular "employee pricing" incentives, consumer demand for cars isn't what it once was.

The Detroit Free Press reports that GM has finally chosen a Volt battery supplier from its dueling development partners LG Chem and Conti. But in the interest of squeezing as many "Volt On The Way" headlines into future news cycles, it isn't saying which has been chosen. Both the battery partner and the final look of the production Volt will be previewed by the end of the year, probably whenever some bad news emerges that GM wants the public to ignore. In the meantime, this news means one thing, according to GM auto authoritarian Bob Lutz: "the Volt is real … and test work is progressing nicely." Perhaps not as nicely as Toyota's plug-in Prius though, which just had its delivery date bumped from 2010 to 2009. And with the 'yota PHEV set to arrive a year before the Volt's "late 2010" target, Lutz makes the case for waiting for the Volt to the AP. Toyota hasn't released an all-electric range for the Prius, but Lutz is assuming that because it's a parallel hybrid it won't match the Volt's 40 mile EV range. "After eight or 11 miles (Toyota's PHEV) reverts to being a completely normal gasoline-electric hybrid, which means you get about a 25-30 percent fuel savings, but the point is they do burn fuel." Lutz goes on: "A plug-in hybrid with a limited range is a very nice thing to have. It's wonderful that Toyota is working on this. If they have some test fleets out next year that's great. But it's not the same thing as a Chevy Volt, which is not a plug-in hybrid." Translation: it will cost more than the Prius, but you'll get more green cred. But don't take Bob's word for it. A full (theoretical) comparison test of the Volt and Plug-in Prius can be found here.

Well, here it is, courtesy of LeftLane News. Maybe. The Chevy electric – gas plug-in hybrid sure doesn't look like the show car that GM's been advertising (as if you could go down and buy one). On the other hand, the Volt shown here isn't a Malibu-a-like, which is a good thing. (Unless you ascribe to Ye Olde German "Different Length of Sausages" School of Model Design.) On the other other hand, the Volt pictured lacks the Toyota Prius' instantly identifiable "quirkiness" and attendant green cred. In fact, in this guise, the Volt's front end shares more than a little gestalt with the current Ford Fusion. So, over to you, our Best and Brightest. Did GM's designers get it right? 

As Farago reported, the amount of federal money Motown would need to turn its business around– if money was, indeed, the determining factor– far exceeds the $25b first mooted. Or the $50b since suggested. And now, having floated not one but TWO trial balloons, Ford, GM and Chrysler are playing coy about the ballooning balloons. To its credit, The St. Louis Dispatch has tried to nail down the exact numbers and conditions, to see if their local minivan plant could be saved. "'We know the legislature authorized up to $25 billion, but the amount that could really make a difference likely is much higher,' GM spokesman Greg Martin told the Post-Dispatch. He declined to say how much additional money would be needed or confirm the $50 billion figure. Ford spokesman Mike Moran also did not confirm the increased loan amount. Chrysler spokeswoman Katie Hepler said the automaker is working to access the government loans. She declined to talk about specific dollar amounts or elaborate on where Chrysler would use any money it borrowed." And here's a surprise. "It also appears that some of the older plants owned by foreign automakers could apply for this loan, according to the original language of the legislation. Toyota Motor Corp.'s Georgetown, Ky., plant and Honda Motor Co.'s Torrance, Calif., location are two that fit the criteria." Only… The Department of Energy has until December to write the final rules that detail how to apply for the money.

A little behind-curtain action for you: When I finished with the 2008 Nissan Murano, I asked Farago if he was interested in a "Take Two" review. He wasn't. As I had even less interest in writing one ("Ride is softer than butter… no! Softer than veal fat"), I didn't. Why waste time insulting a fat pig when I can be losing hundreds of dollars at online poker? As you can imagine, I wasn't exactly doing cartwheels when the Nissan Rogue showed up. For all I knew it was a half-pint version of its (uglier) big brother. And a CVT, too? I was upset. But was I right?

According to The Detroit News, Toyota has walked down its '09 global sales estimates by 700k units, from 10.4m vehicles to 9.7m. This is the second forecast downgrade; a tacit admission by the world's largest automaker that the U.S. sales slump will not experience the rapid recovery its native carmakers have been praying for predicting. "[Toyota CEO Katsuaki] Watanabe said he saw as 'fundamental' the slowdown in the U.S. market as soaring gas prices not only crimp car purchases but drives an unprecedented shift in consumer demand from trucks to smaller fuel-efficient models." And just like GM's suits, Toyota's big boss tried to apply a coat of green gloss to the loss. "In his annual outlining of the company's business plan, Watanabe tried to sound an upbeat note by promising green vehicles. He said Toyota will speed up the delivery of a plug-in hybrid — which can be plugged into regular household electrical sockets — initially promised for sometime in 2010, to the end of 2009." Meanwhile, "It is forecasting its first full-year profit decline in seven years as it faces more problems from the weakening U.S. market." 

Our buddies at Autoblog have strapped on their brave pants, speculating that Toyota's LF-A supercar is DO-A. And there's plenty of evidence to back up their suspicion. There's no production date (not even 2010!), and a $225k price point that won't even pay off development costs. After an uncharacteristically unreliable 24 Hours of Nurburgring race, ToMoCo has opted for a soon-to-be-canceled SC430 silhouette on to its Super GT racer. Plus, Nurburgring testing crews and rival test drivers tell Autoblog that the LF-A is doomed to eternal test-bed status. All of which confirms that Toyota is no longer capable of producing quality performance cars. And reflects Lexus's shift in focus from performance to hybrid luxury. Meanwhile, Car Magazine reports that Honda's hybrid Open Study Model (OSM) will replace the elderly S2000 as Honda's mainline roadster. And they're not talking just styling cues either: the next S2000 will be a hybrid. Unfortunately, details are being held for Car's forthcoming print issue, so we still don't yet know exactly what flavor the hybrid will come in. If Honda's too-good-for-this-life Accord Hybrid is anything to go on, it could be something special.