Nissan has decided that using Toyota powertrains in its Altima hybrid is a bit embarrassing. So they're working on one of their own. If CNet is to be believed, "Nissan's system is designed for a rear-wheel-drive car, and uses two clutches, doing away with a torque converter for more efficient power use." That's right sports fans, he said rear-wheel-drive. But before the hybrid Z-car rumors get out of control, consider that "Nissan hasn't released any details on performance yet, or when it might offer a car with this technology." Mes anwhile, they're charging ahead with Li-ion EVs, apparently. PC World reports that "Nissan has committed to launch its first all-electric car in the U.S. and Japan in 2010 and to mass market the vehicle globally by 2012." The latest prototype is a version of Nissan's Cube. PC World got to take the 80kw beast out on the track. The verdict? "On the test track it easily got up to a speed of 100 kilometers per hour." Breathtaking. But wait there's more! Nissan also has a new fuel cell stack that is smaller and lighter than previous models. And it uses half the platinum of previous fuel cells (a development that'll likely alienate literally hundreds of DUB readers from the green movement). While it's nice of Nissan to remind us that technology marches on, it's no substitute for a here-and-now hybrid system. Y'know, like the one they buy from Toyota.

The Detroit News reports that Senator Barack Obama wants to help Michigan et al. help him become president of the United States (surprise!). To that end, Barack will gladly use your tax money to encourage Detroit to, as my 14-year-old puts it, party like a Barack star. Speaking at the Lansing Center, "Obama proposed $4 billion in federal loans and loan guarantees to help the automakers meet his goal [of 1m hybrids by 2015]– a figure he first mentioned last month in a letter to United Auto Workers leaders — and a $7,000 tax credit to drivers who buy plug-in hybrids." That is, it has to be said, small beer. So Detroit's lackeys said it. "U.S. Rep. John Dingell, D-Dearborn, one of the auto industry's staunchest supporters in Washington, said the domestic companies could require $30 billion or more to meet the goal for their initiatives." Of course, if the real goal was more hybrids, why not let Toyota in on the action? Or the feds could just let the free market do its thing. Anyway… Obama also "modified" his position on domestic drilling (hey, sure, why not?), and proposed selling some oil from the U.S. strategic reserve [just before the election]. In case you were wondering… 

In July, GM, Toyota, Ford, Honda and Chrysler accounted for almost 73 percent of new vehicle sales in the U.S. But individually, how are they doing? To answer that I'm going to start tracking their overall market share and comparing them to each other, plus trending their market shares for 2006, 2007 and 2008. In July, GM held onto 20.5 percent of the market and has a 21.6 percent average market share year to date. Toyota's nipping at GM's heels, though, with 17.4 percent of sales in July and is averaging 16.9 percent of sales so far this year. Ford slipped below Toyota in April, but they're managing to keep Honda at bay so far. Ford's share for July was 14.2 percent against Honda's 12.2 percent; year to date Ford hangs onto 15.3 percent of the market. Honda's 10.8 percent average market share so far this year is still below Chrysler's average 11.4 percent share, but Honda passed Chrysler in May and is well ahead of Chrysler's 8.6 percent share in July. Where will it all end up? Hard to say with today's volatile market, but we'll keep our eyes on it and let you know as and when the music stops.

With great size comes great stupidity. General Motors' fall from grace– from world's largest and most profitable company to bailout bait– illustrates the point perfectly. And while it's about thirty years too early to suggest that GM's replacement will fall victim to the same size-related atrophy, there are already hints that the profits powerhouse known as Toyota is capable of massive miscalculations. I speak here not of the full-size Tundra pickup, but of Scion, the brand that should have never made it out of a focus group.

In June, after a staggering three month rise, Scion sales suddenly slipped by 5.3 percent (11,870 units sold). This despite offering two new models: the redesigned xB (down 10.9 percent) and the all-new xD (replaces the xA).  While ToMoCo's "youth brand" is up eight percent on the year, the timing of its surge and the overall trend indicates a dead cat bounce, due to rising gas prices. Prior to this uptick, from last September through January, Scion's sales declined for 17 straight months.

Searching for clues to Scion's struggle, their not-so-entirely-wonderful products may have a little something to do with it. The super-sized gangsta xB is thirstier and way uglier than the car it replaces. The xD is only marginally more exciting than the now-extinct xA (a.k.a. fish-faced Echo)– and that's saying something (or, perhaps, nothing). The tC has gone from a fixer-upper to a blot of the automotive landscape, dragging Scion down with a 36.2 percent drop in June (off 29.3 percent year-to-date).

Speaking to Automotive News, Scion's manager of sales and promotions addressed the brand's struggle and talked about… sales and promotion. "We have to refresh our message," Jeri Yoshizu asserts. "And move our picture to the new 18- to 24-year-olds." In other words, the buzz within Toyota is that Scion's problem is that it's not cool with the kids anymore; clever marketing can sort that shit out.

That's worrying stuff. You'd think that Toyota, of all automobile manufacturers, would know that great advertising starts with great products. And that great products transcend demographics, or, if you prefer, find their own fans. But then Scion has always been an ass-backwards endeavor: a brand born of marketing aspirations and birthed via stylized badge-engineering, rather than formed in the crucible of a relentless pursuit of engineering excellence. 

Clearly, remarkably, Toyota has not yet learned its lesson on this one. Just as Scion's supposed target market is a moving target, so is the automaker's justification for prolonging Scion's time on this earth. Jack Hollis, the brand's vice president, tells AN that his measure of Scion's success is "not sales numbers but whether Scion is luring new, young customers to Toyota." If so… they're fucked. The number of 18- to 34-year-olds shopping the brand has declined sharply.

Perhaps Hollis should have a word with his boss. On its fifth anniversary, ToMoCo Prez frames Scion's core mission without referring to its intended buyers' age. "The original Scion goal was all about transparency and reducing time to purchase cars and vehicle personalization," Jim Lenz told AN. "And none of that has changed. Scion still remains relevant today."

"How do we expand without making Scion into a traditional car company?" Hollis asks, relevantly. "Experimenting with an automotive brand is tricky in a down market because it magnifies the risk. But if you don't try anything, then you are just the same as the entire industry."

In other words, being different for difference sake is Scion's raison d'etre. Of course, anyone who's spent time inside a Scion xB or xD could take one look at the odd instrumentation and reach the same conclusion. Whether or not Scion's products fit the "quirky is cool" remit– in the metal or consumer's gray matter– it's not exactly a secure footing for a car brand.

Just as importantly, Hollis' query contains the bizarre and grandiose suggestion that Scion is a car company, not an automotive brand. The fact that Scion "dealers" live within Toyota showrooms ought to indicate that Scion is an extension of the Toyota brand; nothing more, nothing less. And a deeply misguided one, in the GM product overlap sense of the word. However you target them, however you personalize them, Scions compete with Toyota products both new and used in the same dealership.

Toyota's Lexus brand made perfect sense: Toyota reliability, distinct upmarket branding, big fat margins. Scion is a non-starter. At best, it can get people to buy Toyota's who wouldn't normally buy a Toyota– and won't even after they do (if you know what I mean). Alternatively, Toyota selling Scions is like those WASPs who wear lime green trousers at the golf course club house just to show they're not really as boring as everyone (including themselves) knows they really are.

If Toyota kills Scion, we'll know they're not General Motors. If ToMoCo persists in this, we'll know that they could well be doomed to repeat GM's history.

Turns out TTAC isn't alone with its Tesla Death Watch and Volt Birth Watch series: Toyota has its own going. EV World's (sub) Bill Moore got this and a few other juicy tidbits from a casual conversation with Toyota's "grumpy old man" Bill Reinert, National Manager of the Advanced Technology Group. Toyota has a Death Watch going on Fisker , Tesla, and…the Chevy Volt. Toyota doesn't think any of them will ever be built in large volumes, because their Li-Ion batteries are simply too expensive to be cost-effective. He also cited concerns over global supplies of lithium. Meanwhile, Toyota is hard at work on next-generation batteries , especially air battery chemistry, including zinc-air, as well as stepping up production of NiMH packs and starting Li-Ion factories. What's the line about not "having all your eggs in one basket"? Reinert also thinks it's unrealistic to expect owners of plug-in to only tap the mains at night. Utilities are going to have to step up capacity. And forget about all the 2010 Prius spy shots floating around the web, they're just cobbled-up mules based on the current Prius. Toyota is famous for keeping their final products under wraps (just one of the many differences with GM). And one more goodie from the grumpy Toyota brain trust: "liquid peak" (every conceivable liquid fuel from petroleum, coal and biofuel) arrives in 2018. That's when global demand will outstrip capacity to produce them all.

Transplant firms pride themselves on running NA operations differently than the D2.8, but the body-on-frame tailspin has no interest in pride or strategy. Automotive News [sub] reports that Nissan, which has never laid off a North American worker, will buy out about 1200 employees from its Tennessee plants. Workers at Smyrna Assembly and the Decherd powertrain plant will be offered up to $125k to leave over the next three years, saving Nissan 18 percent of its TN payroll and shutting the night truck production shift. By Detroit standards, this measure is almost not worth reporting on. But for Nissan and its employees, the stakes are considerably higher. At least that's what the UAW wants us to think; they're playing the told-ya-so card to Nissan's worried Tennessee employees with more than a little schadenfreude. "As a union member, contractually, I know what my rights are," says Mike O'Rourke, whose UAW Local 1853 has twice failed to unionize Smyrna. "Unfortunately, at Nissan, they don't know what the bottom is. And they're afraid… In their employee meeting, one of the employees said, 'If we don't go, are you going to reduce our wages?' And management wouldn't answer," says the UAW honcho. "I think you and I both know the answer to that question." Except that, absent any actual examples of transplants screwing workers, the evidence points rather away from O'Rourke's scaremongering suggestion. For example, rather than abandon or otherwise its employees at Tundra/Sequoia plants, Toyota is keeping employees busy (and paid) by training them and improving operations. While UAW shops are cut and shut left and right. Funny how that works.

There's one good thing about a crisis: it motivates people to create remarkable things that wouldn't have been possible (or necessary) in normal (or desired) circumstances. Remember: an oil crisis gave birth to the original Mini, a remarkable piece of engineering with incredible efficiency. Now that the days of efficiency are back, the car industry has once again been forced to awaken from its boringly predictable evolution and offer us some new efficient and smart solutions. The first signs have already been visible for a few years, with manufacturers showing a plethora of microcar concepts. Some producers even have such projects in advanced development. As spy photographs show, Fiat is currently testing a car smaller than the 500. At 3.2 meters the new Topolino ("little mouse" in Italian, named after the original model produced between 1936 and 1955) is expected to use the same 3+1 seats solution as the Toyota iQ concept (the rear bench is divided into a normal-sized and a smaller chair, placed right between the rear wheels at the very back of the car). With both rear seats in use, the car has virtually no trunk space. But fold the rear bench and now you got room for… a suitcase or two. Anyway, it's a remarkable achievement that could rival the original Mini. From a design POV, this layout doesn't allow for a sloped roof. I reckon a boxy rear will be the recognition element for all the 3+1 cars.

Growing up, I thought the Porsche 911 was hideous. Its bug eyes and lumpy lines made me wonder if the designer had accidentally knocked modeling clay off his drafting table and submitted the splatter. This notion persisted until I drove one. Some 130 mph later, I considered the 911 the most beautiful automotive form on earth. Driving the all-new 2009 Honda Pilot EX-L kinda sorta triggered the same type of perceptual realignment. Call it Zen and the art of "challenging" design.

The crossover– crudely defined as a SUV-styled car– hasn't fared well in the Great Sales Meltdown of 2008. The Wall Street Journal reports that the segment slipped 11 percent from last year. Thanks to a combination of high gas prices, atrocious SUV trade-in/resale values and generally high CUV prices, SUV owners are trading down to cars, rather than across to CUVs. Uh-oh. Carmakers were counting on larger profit margins on those CUV's to keep them afloat in these lean times. Even sales of small and relatively fuel-efficient CUV's (a.k.a. "cute utes") are lackluster. The Toyota RAV4 (12,006) is down 20.7 percent [unadjusted for sales days is how we roll]. Honda's CR-V (17,419) tumbled 15.3 percent. There are a few bright spots in the CUV market: the Nissan Rogue (6,525) and Subaru Forester (5,559). But their combined sales generated about the same volume as the RAV4. The Dodge Journey, at 3,306 sales last month and 26,180 for the year, is already is selling for thousands below MSRP. [BTW, the brand new Ford Flex barely edged its outgoing platform-mate Taurus X, 2,204 vs. 2,034.] Even with gas prices dipping, the CUV genre seems stillborn. GM identified the fourth Lambda-platformed Chevy Traverse (post-Buick Enclave, GMC Acadia and Saturn Outlook) as the only key product launch in North America this fall. Not good on stilts.

If brevity be the sole of wit, Chrysler CEO Bob Nardelli's latest email to his troops is a particularly humorless e-missive. Although ours is to question why (whether they do or die), it's the weekend. So I'll leave the parsing to TTAC's Best and Brightest. Suffice it to say Bob's commemoration of Cerberus' Chrysler purchase is a curious blend of woo-hoo, uh-oh and hey ho, let's go! We'll be sure to update our Chrysler Suicide Watch soon. Meanwhile, here's the text in full…

"Dear Employees,

One year ago, we began to write a new chapter in Chrysler’s proud history as Cerberus acquired the majority stake in our company. In spite of the severe economic and industry challenges of the past 12 months, we have laid the groundwork for a successful turnaround and transformation of our business. Today, we are working together with a clear direction and with a sense of urgency to return Chrysler to profitability and its rightful place as an iconic American company. On behalf of the Office of the Chairman -– Tom LaSorda, Jim Press, Ron Kolka and me –- I want to thank you for your hard work, and pass along the personal appreciation of Steve Feinberg as well as our partners at Cerberus and Daimler. I’d also like to share some thoughts with you on the occasion of this anniversary.

As a privately held company, we operate with some real advantages. Being private helps us be agile and decisive, highly responsive to our customers and fast to act on market opportunities. We are re-establishing our own culture and identifying our own measures for success based on operating as a single team focused on the common goals of “customer first” and “quality … period.”

We also have a clear focus on achieving the key financial expectations of our owners, which include EBITDA (earnings before interest, taxes, depreciation and amortization) and cash flow performance. As a private company, we’re now able to generate cash more easily through the sale of non-earning assets. This enhances our ongoing operational improvement efforts, enabling us to continue to invest in new products as we work to reduce our fixed costs, inventory and working capital.

Working together with the UAW, we signed a landmark labor contract that provides a framework to improve our competitiveness. Over the past year, our leadership also made some difficult decisions to "right-size" our company in line with the realities of a tough economy and an auto industry caught in the rapid shift in consumer preferences driven in part by escalating fuel prices. I can assure you that these gut-wrenching decisions are not taken lightly by me or anyone on the leadership team. Going forward, we will do what’s necessary to remain competitive in the short term, while balancing the need for continued investment in support of our long-term strategy.

Our company strategy can be boiled down to what I call the three E’s:

Enhance our Core

Extend our Business

Expand our Markets

We’re making progress on all fronts.

Enhancing the Core includes an intense focus on customers and quality, our product line and our dealers. We hired the industry’s first Chief Customer Officer to help lead efforts to better define, measure and improve quality. Creating a new online Customer Advisory Board has enabled us to get fast feedback on important issues. The Let’s Refuel America program, for example, was a direct response to customer concerns over fuel prices.

In line with our customer focus, enhancing the quality of our current and future products is critical to our success. Launch performance results for the past year are encouraging: from our own teams and from our dealers, we’ve heard that our recent launches have been among our best. During the last year, we approved more than 400 product enhancements designed to improve interiors, upgrade materials, and reduce noise and vibration. To date, more than 250 of these changes have been implemented, and the remainder will be in production during the 2009 model year and the start of 2010.

Although we did not perform as well as we should have in the recent J.D. Power and Associates Initial Quality Study, our company did improve five points overall, our Chrysler and Dodge brands were up in the ratings, and the Durango and Dakota were first in their segment. A more significant gauge of our progress in quality is that, since last August, we’ve seen a 29 percent reduction in our warranty claims. In addition, we expect a 20 percent improvement for our 2009 models. While we’re early in our launches, the results we’re seeing –- like reduced NVH (noise, vibration and harshness) in the Challenger, the Ram truck interior quality — are greatly improved.

In the area of productivity, the recent Harbour Report showed that Chrysler equaled Toyota as the most productive auto manufacturer in North America. This is a remarkable turnaround from seven years ago, when Chrysler was dead last among major manufacturers. In addition to boosting our productivity, this achievement has the added benefit of increasing our capacity utilization significantly. It really shows what we can do when we work together with a commitment to continuous improvement.

We are continually re-evaluating our model lineup to ensure that we’re focusing our resources on the best opportunities in the market, and we made a decision during the year to drop four models from our portfolio. Many industry analysts continue to bemoan the “light truck” bias of our product mix. They miss a salient point: most customers do not consider our Compass, Patriot, PT Cruiser, Pacifica, Journey or minivans to be “trucks,” although they are classified as such. So, from the customer’s perspective, our current mix is 59 percent car, compact SUV and minivan, and 41 percent pickup, medium and large SUV.

Meanwhile, our product portfolio is becoming more balanced, and our newest models are right for the times. The Dodge Journey, which received a rave review from USA Today, is a “right-sized” crossover that offers class-leading 25 miles per gallon highway, starting at under $20,000 in the United States. The Dodge Challenger, a modern muscle car, will come with a fuel-efficient V-6 option and an aggressive entry-level price of $21,995 in the United States. Customers focused on fuel economy will find six vehicles that offer 28 mpg or better on the highway in our 2009 model lineup — the Compass, Patriot, Avenger, Sebring Sedan and Sebring Convertible — and the Caliber achieves 30 mpg highway fuel economy.

There will be a viable and sustainable light-truck market going forward. It’s just likely to look more similar to the truck market before the light-truck boom of the '90s, with the notable exception that we expect to capture a greater share of it. For example, the crew cab segment represents half of the truck market. With our new all-new 2009 Dodge Ram crew cab offering we’ll be able to compete in this segment for the first time. We think the current economic climate, in spite of its challenges, provides us a real opportunity to gain even more ground. Our new Ram full-size pickup will be a "game changer," thanks to its outstanding performance, technical innovations, breakthrough design and top quality. We elected not to delay this launch as our competitors have, therefore, we will be first to market with a better product, along with marketing, advertising and retail launch support that’s truly world class.

To develop future products with greater appeal to customers, we are in the midst of investing $3 billion into powertrains to create multiple driveline solutions that will increase our overall fuel efficiency, including new engines, axles and transmissions.

And we created a group called ENVI that will develop electric-drive vehicles that support the vision of our Chrysler, Dodge and Jeep brands. Derived from the word "environment," ENVI is a dedicated in-house organization charged with making Chrysler the leader in advanced-propulsion technologies. Our electric vehicle program will really send a shock through the industry — so stay tuned for more details.

Rebuilding strong relationships with dealers has been a major priority this past year. One example of how we’re listening to our dealers is that we have reduced inventory by 67,000 units compared with a year ago. We’ve changed our dealer incentive program and put dealers back in charge of our regional advertising associations because they know their local markets better than we ever will. We’re also working with our dealers to "right-size" our network. Fifty-eight percent of our dealers now carry all three of our brands under one roof, up from 53 percent just last year.

The latest J.D. Power Customer Satisfaction Index (CSI) shows progress in the way our company and dealers are serving our customers. Chrysler LLC scored 865, a 10-point improvement with Jeep and Chrysler brands among the most-improved brands in the industry, and the Chrysler brand (882) outperformed the non-premium average (879) in the 2008 study. We have implemented a number of efforts with our dealer partners that we believe will continue to improve customer satisfaction.

The second part of our strategy is Extending our Business, which means capitalizing on adjacent opportunities in a number of ways. For example, consumers tend to keep vehicles longer in a slow economy, which represents a significant opportunity for us to capture more of the growing service and parts business. And we’re extending our business by investing in new products that give us coverage in new segments. Last year, we extended into the class 4 and 5 medium-duty truck markets with entries that offer best-in-class fuel economy. This followed our return to the class 3 truck market in 2006 with the all-new Dodge Ram 3500 Chassis Cab, which quickly achieved a 29 percent market share.

We’re working diligently to fill gaps in our portfolio by adding small car programs both through internal development as well as partnering initiatives. Later this year we’ll launch our first hybrids, the Chrysler Aspen and Dodge Durango. Both deliver a 25 percent overall improvement in fuel economy without sacrificing performance or the towing capabilities our customers need and expect.

We’re also extending our business through innovative new technologies, including in-vehicle wireless Internet connectivity available from Mopar by the end of the year. Our next generation of innovations also includes a segment-first Blind Spot Monitoring system for our minivans and a Chrysler-first Rear Cross Path System that notifies the driver of any car crossing his or her path when backing up.

In June, we announced our new uconnect family of technologies that provides consumers with phone, GPS, music, video and Web connectivity. Uconnect phone provides voice-controlled wireless communication between the occupants’ mobile phones and the hands-free system that automatically downloads up to 1,000 phone book entries from supported phones. Uconnect tunes features a 30-gigabytes hard drive to store music, videos and photographs. Uconnect GPS offers navigation and real-time traffic reports combined with voice recognition and an easy to use touch screen. Uconnect web turns the vehicle into WiFi “hot spot," delivering Internet connectivity directly to the vehicle.

Expanding the Market is the third part of our strategy, and it involves increasing our participation in vehicle segments and international markets where there is significant growth. Our international sales continue to grow, and we’ve established Global Centers of Excellence to support design, engineering, sourcing, manufacturing and distribution activities for local and regional markets.

We are currently engaged in more than two dozen alliances and partnerships with other OEMs and suppliers around the world to help extend our product portfolio and better use our manufacturing capacity. In January, we struck a deal with Nissan to supply us with a version of its B-segment sedan, the Versa, for limited distribution in South American markets beginning in 2009. Then in April, we reached another agreement under which Nissan will manufacture an all-new, fuel-efficient small car based on a unique Chrysler concept and designed for sale in North America, Europe and other markets in 2010. In return, Chrysler will manufacture a full-size pickup for Nissan in 2011.

Enhance the Core, Extend the Business and Expand the Market. Still, there’s one more “E” -– it’s the need to Execute. Going into this second year as an independent, we need to flawlessly execute our strategy and commit to improving everything we touch. We must pull together to design, build, sell and service aspirational vehicles with true competitive advantages –- vehicles that can be proudly displayed in showrooms around the world. We will continue to face the realities of the economic environment and our global industry, see them for what they are, and do what’s necessary to return Chrysler to profitability and sustained growth. As we have for the past year, we will work to shape the future before it shapes us.

While I’m proud of how we’ve faced business challenges together this year, I’m also proud that we’ve never lost sight of our commitment to support the communities we’re privileged to be a part of. Our philanthropic fund changed its named to The Chrysler Foundation and continues its work around the world to strengthen the communities where our employees and customers live and work. One example of how the foundation is tying together our dealers, business centers and communities is our partnership with KaBOOM! to build playgrounds, helping ensure every child has a safe place to play. We’ve identified 25 new playground sites and many of them already have been completed.

Building on our proud American heritage of support for those who wear the uniform, we also inaugurated the “Honoring Those Who Serve” program and forged partnerships with groups like Operation Gratitude and the Freedom Calls Foundation. Our military support efforts won several awards, including the Secretary of Defense 2008 Employer Support Freedom Award. At our Military Appreciation Month celebration held in May, employees put together 500 packages for Operation Gratitude to send to service men and women on active duty abroad in addition to the 300,000 packages already sent and distributed. At the event, we also revived the wonderful military tradition of the service flag. We are prominently displaying a Blue Star flag for every employee on active duty. In addition, we unveiled a Gold Star flag to honor an employee whose life was taken while on active duty, and presented it to his loving family.

Our continuing efforts in diversity also were recognized during the year. Chrysler was named “Company of the Year” at the Urban Wheel Awards; we were named to Black Enterprise magazine’s list of “40 Best Companies for Diversity”; we received the top grade in the automotive sector in the annual NAACP Economic Reciprocity Report; and Chrysler was recognized as a “Top 50 Company for Supplier Diversity” by Hispanic Enterprise magazine.

Perhaps the highlight of the year for many of us came on June 26 with the long overdue return of Lee Iacocca to the building and to the company he so strongly influenced. If you were able to attend this event, you saw first hand some of the energy, spirit and passion that Lee brought to Chrysler. He took time to talk with the leadership team and was extremely impressed as he reviewed the next generation of Chrysler, Jeep and Dodge products in our styling dome. He was particularly moved by the warm reception he received from our employees, and as he departed from the Tech Plaza event, he stopped and shook hands with everyone he could. In my remarks that day, I quoted from the speech Lee gave in 1979, just about one year after he joined Chrysler. He spoke about the people of Chrysler, and his words are just as true today:

“If the old-fashioned American virtues of hard work and dedication still work in this country –- and I believe they do –- we will not fail. Our people are the hardest working, most dedicated individuals I have ever been associated with, and they believe in this company.”

Looking ahead, we face a sobering reality of an economy and an industry in North America that continues to contract. But we continue to meet the challenges head-on, never losing sight of our goals. For example, this week Chrysler Financial announced that they will discontinue offering new lease products in the United States. But we will also significantly enhance our incentive and financing options to make our vehicles available to customers at affordable payments. Here are a few more facts on this change to keep in mind: Current vehicle owners who lease through Chrysler Financial are not affected, and the terms of their contract will remain in force. Chrysler dealers are still able to offer lease financing arrangements with other financial institutions. Employee lease and Company Car Programs for current and retired salaried employees whose vehicles were obtained through the company are not affected, and we’re working to protect this program for the future.

Our July sales, which we will announce today, while disappointing, continue to reflect the downward trend of this market and economy. Our challenge is to return to profitability and to profitable growth, which begins with a focus on revenue generation and sales.

So, let’s meet this challenge together. As we mark this first anniversary, let’s all focus on revenue, put our sales hats on and talk up our products to everyone we know and make a sale. And to help get started, I’m pleased to announce that all employees and retirees will be given a CDI (Certain Designated Individuals) number. More details will be sent to you next week, but similar to the Employee Choice program, this number will enable anyone to purchase a new Chrysler, Jeep or Dodge vehicle at the employee price through Sept. 30.

In closing, I can tell you that I am very proud to be part of this great team, a team with the experience, the intellect and the passion to bring Chrysler back to its historic place. I thank you for your hard work and many accomplishments of the past 12 months, and ask each of you to bring the same dedication to the coming year. Chrysler may be down, but we’re a long way from out. It’s time for us to prove the naysayers wrong with another one of our patented comebacks!

Sincerely,

Bob" 

The July sales numbers are starting to come in and they're not encouraging. Toyota's overall sales dropped 11.9 percent from last July.  As you can probably guess, trucks were responsible for the largest chunk of Toyota's dismal numbers; passenger cars were down only 5.7 percent while trucks plummeted 29.5 percent. If Toyota's turning in numbers like this, it's going to be scary to see everyone else's reports. We'll post 'em as we get 'em.

Click here for Toyota sales press release

[NB: The numbers in the official press release are adjusted for sales days; TTAC reports the unadjusted numbers.]

Ouch. The Summer of Detroit's Discontent (not to mention everyone else's) continues to hammer the worst laid plans of truck-heavy automakers. And while everyone gives FoMoCo CEO Alan Mulally credit for being the most "realistic" of The Big 2.8's helmsmen, he ought to have a word with his PR department. Do they really think headlining their all-caps press release "FORD FOCUS CONTINUES TO SURPRISE, OUTPACE SEGMENT" is going to distract anyone from the fact that Dearborn's darlings' overall sales are down by 14.7 percent versus last year? On second thought [via The Detroit News]… "Car sales were up 7.8% in July compared to a year ago. Meanwhile, sales were down 7.8% for crossovers, 54.4% for SUVs and 18.1% for pickups and vans." FYI, Focus sales (a horrible car by my snobby estimation), totaled 15,200 units. Toyota shifted 34,438 Corolla's in the same time period. Just sayin'.

Click here for Ford's sales press release 

(Note:  The numbers in the press release are adjusted for sales days, so they will vary from the unadjusted numbers reported here.)

OK, that's not the real name of Chrysler "We Don't Need No Stinkin' Leases" program. It's "Shop 'til You Drive." You have to admit: it's a lot less catchy than our version. I mean, I'm not quite sure how the ChyrCo message parses. Shop 'til you drive away? Shop 'til our salesmen drive you nuts? No se. Here's ex-Toyota and current ChryCo Prez Jim Press' official explanation [via Automotive News, sub]: "We are leveraging the move from leasing to retail purchases to offer our customers the best deals of the year and make buying as affordable as renting." No way Jose! Anyway, the bottom line: 40 percent off sticker for the Ram, 25 percent off MSRP for the Aspen, 24 percent off the Town & Country minivans and 28 percent off Grand Cherokees. Chrysler Financial is offering up to $2k cash on "select" retail purchases and expanding its 72-month financing. Apparently, Chrysler "Celebrates August Retail Purchase and Finance Enhancements." Please don't tell me a Lionel Ritchie soundtrack is heading our way…. 

Click here for "Shop 'Til You Drive Sales Event" press release  

Spy shots of what could credibly be a new Toyota Prius have finally surfaced. The next-generation of "America's Car" looks bigger than the previous iteration, but that's about it in terms of differences. The new Prius sports styling that is nearly identical to the outgoing model, with only a tightened greenhouse to spoil the rear vision freshen up the looks. Of course it will be more powerful and more efficient (according to Toyota). The spy photographers who sent these shots in to Nextautos speculate that the larger dimensions mean wagon and convertible versions could be forthcoming. Though these possibilities would be good news for ToMoCo's ambitions to build the Prius brand, they'll be sure to have their hands full just supplying demand for the standard version. Although, with Honda's unnamed Prius-fighting sedan in the offing, Toyota might want to differentiate the Prius from its blatant knockoffs.

A month or two ago, I had the brilliant idea to enter a rental car into a car show, and see what I would win. The Avis Hummer H3 I spent untold hours detailing won first place in the truck category. Being only slightly insane, I decided to try another rental car challenge (due to my Porsche still being in various pieces), and enter a weekend special into an SCCA Autocross. Nearly winning my division last year, I believed that winning was mainly due to the driver, not the car, so of course I would come out on top no matter what I was driving. $78 later in rental fees and race entry fees, I had a 2008 Subaru Outback, with a 173bhp, AWD and lots of cargo space. Despite ripping nearly 150lbs of weight out of the car, the Subie couldn't have been more disastrous. The Sportshift always held the wrong gear, and wouldn't let you shift manually under extreme maneuvers. The steering became so imprecise that I was no longer driving the car, I was guiding it. The AWD made the car understeer, or oversteer, in a completely unpredictable manner. The lack of low end power had me uttering strings of curses upon exiting nearly every corner. I was easily outrun by a similar 2.5-liter equipped Impreza. I was outrun by a Honda Civic, a Dodge Neon, and an automatic-equipped Toyota Echo. And then we loaded the wagon up with five people, kept to the starting line, and learned the joys of e-braking through the corners, where the Outback stopped skittering, and literally "hopped" around the bends. As a race car, the Scooby gets one-star. But I suppose you already guessed that.