In a speech in Cape Town, South Africa, Robert F. Kennedy put a phrase into common usage by declaring "There is a Chinese curse which says, ‘May you live in interesting times.’" Lexicographers now say Kennedy made it up. But if it was true, you could argue that Toyota’s been cursed. While critics focus on the automaker’s recent experiences with recalls, leaked memos, NASCAR additives and misleading ads, pickup trucks are where things are starting to get scary.

Toyota’s new Tundra has been giving the automaker a rare case of the heebie-jeebies. Beancounters budgeted building the brand’s spanking new San Antonio truck plant at $850m. Due to last-minute changes and higher than expected material costs, the final tab ballooned to $1.28b. The executive who oversaw the cost overruns at the Tundra assembly plant, Hidehiko "T.J." Tajima, returned to Japan to assume Toyota's corporate social responsibility activities.

More worryingly (at least for a company as immensely profitable as Toyota), the San Antonio truck plant’s production schedule wasn’t in synch with their engine plant in Huntsville, Alabama. At the insistence of Toyota’s sales and marketing soothsayers, the first new Tundras to pop out of the cattle chute were supposed to contain 5.7-liter V-8 engines (so that the company could boast horsepower ratings that meet or beat the domestics’). But the big engine's production wasn't scheduled until mid-year.

For a company know for being as efficient as the Borg, this must have come as something as a rude surprise. Fortunately for Toyota, the engines were put into production in time.

Then The National Highway Traffic Safety Administration crash tested the new Tundra. The new vehicle only managed four stars in the frontal crash test. While not a bad rating per se, the Tundra’s domestic opposition– Ford F-150, Dodge Ram and GM Silverado– are all five-star rated. Again, it showed a chink in Toyota’s supposedly unassailable armor.

Most recently, Automotive News reported that Toyota flubbed the product mix coming out of San Antonio. Toyota had underestimated demand for the double cab and CrewMax, while overestimating demand for the lower-priced, standard cab base model. Consumer demand for Huntsville’s 5.7-liter V8 engine also outstripped supply. 

Toyota’s miffed model mix put them in the novel and unenviable position of having to offer rebates on a brand new model to move the metal. Just weeks after launch, pickup truck buyers could take advantage of incentives up to $1500 on the slow[er]-selling base Tundra.

"We didn't come to the prizefight with all our tools," admitted metaphor-mixing Ernest Bastien, Toyota's vice president of vehicle operations.

While domestic supporters may smirk at the new Tundra’s teething troubles, no one should mistake them for a lack of commitment. When Toyota first entered the U.S. market their products were not competitive. Rather than retreating, they learned from their mistakes and came back with better vehicles. Toyota is now arguably the world's premier mass market automaker and, soon, the largest as well.

In any case, the new Tundra is hardly DOA, or even “struggling.” In March, Toyota dealers unloaded 13,196 Tundras. Year-to-date, that’s a 12 percent increase over the old model’s numbers. Toyota predicts that new model sales will gather momentum in the summer, going on to achieve the planned 200k annual pace.

Toyota can offer such optimistic predictions with confidence because they are going to do whatever it takes to make it happen. Currently, Toyota offers Tundra buyers low interest financing, $1k trade-in assistance for early lease termination (on a previous generation Tundra) and $1-2k dealer cash incentives, depending on model. If that doesn’t work, more attractive offers will follow.

In other words, those who point at the Tundra incentives as a sign of weakness have got it exactly backwards. They are an indication of the automaker’s resolve to offer whatever financial lures are needed to hit its stated sales goal.

Lest we forget, The Big 2.5’s fortunes have descended to the point where they depend on pickup truck sales for their survival. For Toyota, a big deal is no big deal. Last year, the Japanese automaker’s U.S. sales rose 12.5 percent, helping generate a $13b profit.

This brings us back to the “interesting times” curse and the ToMoCo’s previously stated need to "manage Detroit's decline." If Toyota launches a major price war against the domestics’ high-profit pickups this summer, the damage to GM and/or Ford's profit margins could well be fatal. In that case, there could be some kind of anti-Toyota backlash from either the U.S. government or (worse) consumers.

Toyota knows this. As strange as it sounds, would they hang fire to protect the domestics? That die was cast when they built the San Antonio factory. 

In a recent study of new vehicle owners, Ford products came second in "overall initial vehicle quality." According to Ford's PR release, Honda took the top slot, while Toyota and Nissan tied Ford for second (although Toyota actually beat Ford by three points). Yes, well, it turns out The Glass House Gang paid for the report, which mirrors the format of J.D. Power's Initial Quality Survey (IQS) without reproducing the results. Last year, JD's mob ranked Ford fifteenth in Initial Quality, one place beneath the industry average, nine places behind Honda and eleven places behind Toyota. Anyway, who cares?

Define quality. Is it design, durability, longevity, reliability, fit and finish, snob appeal, something else or a combination of these factors? How do you– or should I say "one"– calculate the relative importance of any particular attribute? Is reliability really the sine qua non of quality? Is longevity more important than fit and finish? Given the subjectivity of the term, it's virtually impossible to determine a vehicle's intrinsic "quality."

Back in the ‘70's, slipshod assembly, dubious dynamics and instant rust were the status quo. Any car good enough to win a quality award stood out from the crowd. Today's cars are the best-assembled, most defect-free, longest-lasting vehicles ever produced. Claiming a car rolling off one assembly line is higher quality than one coming off another assembly line is like claiming the Pacific Ocean will make you wetter than the Atlantic.

While pistonheads tend to fixate on minute differences between vehicles, the majority of the public are well aware that current mainstream motors offer roughly similar looks, performance, mileage, packaging, reliability and safety. Strictly speaking, Ford and other mass market automakers are selling mediocre products. To cut through the clutter and create a reason to buy one loaf of white bread over another, manufacturers use IQS studies to proclaim they're offering higher-quality mediocrity than the competition.

Quality is supposed to be a differentiator, something that shows that one item is superior to another in one or more aspects. The Ford-financed survey– and Detroit's continual harping about "the perception gap"– reflects the fact that many manufacturers don't get it. They're still stuck in the "Hey, give us a chance! We're just as good as the other guys now!" mentality. When the average person determines whether or not a vehicle is a quality product, they're not looking for "as good as." They're looking for "the best."

To achieve that, today's automakers must produce profound reliability AND sweat ALL the small stuff. Our reviewers have been continually criticized for continually criticizing the quality of a given car's plastic surfaces. Yet the look, feel, shape and smell of a vehicle's polymer's reveal a great deal about its overall quality. Just by prodding the dashboard, even a layman can tell if he or she's sitting in a beancounted beater or an upmarket luxobarge. Same goes for closing a door, or listening to the radio, or pressing the gas pedal.

Yes, it's a challenge to create the highest possible quality at a specific price point. But that's the challenge all automakers face. And in today's hyper-competitive automotive market, there's simply no margin for error. MINI's IQS scores took a beating when they introduced the car without cupholders. Many pundits asked, has it really come to this? Yes, it has.

Anyway, if automakers were truly interested in determining the quality of their products, they'd survey owners long after the new-car honeymoon had ended. They'd ask for feedback on reliability, fit and finish, repairs, out-of-pocket expenses, performance and how well the vehicle held up overall. If the buyer no longer owned the vehicle, they'd find out why their customer got rid of it.

After collecting several years' data, they'd know more about their vehicles' quality than any IQS would ever tell them. This information would be far more relevant to the consumer than knowing that car A averaged 0.043 fewer defects when new than car B. If a manufacturer came out on top of this kind of survey, they'd have something to brag about. And it would be interesting to see how their IQS ratings correlated to their "real world" results after a few years.

I have no idea why manufacturers haven't embarked on a project like this. The only reason I can think of: they don't want to take a beating from the reality stick. They'd rather go on blithely believing surveys that tell them their brand-new cars look, feel and act brand-new than watch their self-aggrandizement shrivel to nothing in the face of cold, hard data.

I know I'm tilting at windmills here. But it's high time the manufacturers stop hiding behind bogus quality ratings and start producing vehicles that are designed to be class leaders in every aspect. Then they wouldn't need contrived crutches like initial quality surveys. The product would sell itself and customers would be lining up for more.

Every year over ten million vehicles pass through U.S. auto dealer auctions. This decades old free market has always been dependent on you, the consumer. Dealers will bid up those models that are popular with buyers, while those with a limited audience are stuck in what’s commonly called ‘wholesale heaven’. This is a place where thousands of unappreciated and unloved models go until the market dictates otherwise. Over the course of time, consumers dictates the winners… and the losers.

Over the last few years, The Big 2.5 have been downsizing their domestic production capacity to match falling demand, and compensate for their decision to wean themselves from low-profit fleet sales. Enormous assembly plants that once produced hundreds of thousands of new vehicles are now shuttered. The theory: as production sinks, new car prices will eventually hold firm and profits will follow. Unfortunately, the latest patchwork of new product has already come apart, and the domestics' market share continues its seemingly inexorable slide.

There are three main causes for today's used car glut. First, the manufacturers shut off the supply spigot late in the game. Thanks to restrictive union contracts and timid management, carmakers failed to ‘chase down’ falling demand early or aggressively enough. The failure created an ongoing surplus of used cars.

Second, again, The Big 2.5’s market share for new cars is still falling and they’re still failing to match supply to new car demand. Banking unsold inventory and embracing badge engineering has lead to hundreds of thousands of vehicles that consumers do not know or care about.

Finally, Toyota, Honda, and Hyundai have remained fiercely loyal to the idea of building brand identity and limiting supply when the market dictates. This devastates the profitability of the domestics, who are stuck with an over-sized dealer network and a “stack ‘em high and sell ‘em cheap” sales strategy.

This endless stream of unpopular and largely unknown new cars– and the sales incentives that inevitably follow– has created a significant benefit for the U.S. consumer: a depreciation curve that makes lightly used cars a fantastic deal.

In the early days of zero percent financing (late 2001), experts estimated that every $1k in new car sales incentives resulted in a $400 decline in the price of a two-year-old version of the same vehicle. By the time employee pricing came to the forefront (the following summer), the hit to used car prices was closer $600.

Many dealers peg the current depreciation rate at around $750 per $1000 in new car incentives. For your neighborhood used car dealer, their late model inventory now has a depreciation curve that’s nearly as steep as a new car vehicle’s. As a result, there are literally tens of thousands of unsold low mileage cars churning from dealership to dealership. 

The bottom line: a brand new Mazda Miata with all the options sells for around $27.5K. As of April the eleventh, the Average Auction Wholesale (AAW) on a 2006 Chrysler Crossfire with 3,945 miles was also $25k. Not that many consumers would cross-shop the two roadsters, but a Crossfire that stickered for over $45k a year ago now costs the same as a new Miata.

In the last 60 days, a savvy buyer could also pick up a low mileage 2005 Mercury Milan, Pontiac G6, Mercury Grand Marquis, Cadillac Catera, Buick LaCrosse, Ford Freestar or Volvo V50 for around the same money as a brand new, 2007 Kia Rio. That’s cheap.

You may notice these models are the unloved off-spring of over-stretched or neglected brands. The selection and price reflects a new reality: manufacturers have created a perfect storm of overproduction, fleet sales, model inflation (dozens of new nameplates debuting every year), limited marketing resources and bad branding. Though they’ve been available for years, models like the LaCrosse, Montego and Outlander are falling through the cracks, and into used car depreciation Hell.

Plenty of consumers “get it.” As vehicle reliability has increased, more people are buying used– but still not enough to outstrip supply. And yet still, the new cars keep coming.

Smaller new car dealers in larger metropolitan areas are getting whacked by these economics. For every Carmax, Team (formerly AutoNation) and Sonic Automotive Group that expands its operations, a dozen independent dealerships fall by the wayside. Never mind the mainstream manufacturers’ decisions to “rationalize” (i.e. cut) their dealer networks. The growing used car market is forcing hundreds of family-owned new car dealers to either accept competitor buyouts or simply close shop. 

For TTAC readers who understand that depreciation is the single largest cost of automobile ownership, or who simply want as much car for the money as they can afford, used cars rule.

As for what you should pay, go to the “completed items” section on Ebay and look for a car that’s roughly equivalent to the apple of your eye. You’ll find a price that’s usually a bit higher than wholesale, but lower than the inflated retail values you’ll find at Edmunds and Kelly’s Blue Book. There’s your starting point.

Call or email a few dealerships and bargain hard. You’ll soon see that the old 80/60 principle for a two-year-old model (80% of the life for 60% of the original selling price) is now closer to an 80/40 split. 

It’s proof positive that the free market has spoken. Until and unless mainstream manufacturers can better match supply to demand and learn to produce fewer, more distinctive models, their new cars will continue to make one to two-year-old models cheaper and better values. It’s a virtuous circle– for you.   

Beware the Ides of March! OK, relax. The sales figures are in for Julius Caesar’s final month. While it's hard to find new ways to say "GM, Ford and Chrysler sales are sinking while Toyota's eating their lunch" month after month, it's not impossible. How about this: The Big 2.5 look more and more like Lawrence Edward Grace Oates (to Toyota’s Roald Amundsen). “I am just downsizing and may be gone for some time.” Anyway, the more things change, the more they change the same.

Compared to last March, GM sales sank four percent, Ford’s plunged nine percent and Chrysler Group’s tumbled 4.6 percent. Overall, domestic vehicle sales were down 3.7 percent— against the backdrop of ToMoCo's 11.7 percent sales gain. Despite Toyota's seemingly unstoppable ascension (managing Detroit's decline is still job one), there were a few reasons to be cheerful.

Pre-divestiture Chrysler watched The Dodge Boys move 32 percent more Calibers than last year, proving that their macho SUV-lite has legs. Less explicably, Charger sales galloped ahead by 40.8 percent. And thanks to the runaway success of their new four door, Jeep Wrangler sales scrabbled ahead by 63.8 percent.

The Ford Fusion continues to gain traction; sales are up 47.5 percent over last year. Capitalizing on the small car surge, Chevy sold 53.1 percent more gas-sipping Aveos in March ‘07 than in March ‘06. At the other end of the CAFE spectrum, Expedition sales rose 27.8 percent while Suburban sales were up a gargantuan 73.3 percent.

March on March, import sales were up 17.5 percent. Mazda came in with the lion’s share; the Ford sub’s sales rose by 47.9 percent. Mitsubishi showed a healthy 22.3 percent increase. Stalwarts Toyota and Honda clocked 15.6 and 13.6 percent increases, respectively. It would’ve been an even more dramatic import victory if not for Scion (down 23 percent), VW (down 15.3 percent) and BMW (MINI tumbled 5.1 percent).

For the most part, inventory levels declined across the board. Only two Fords exceeded the magical 90-day supply mark: the Mark LT (101 days) and Montego (95 days). Chrysler has recovered from the sales bank fiasco; only low volume models (Viper, Crossfire, Sprinter) are languishing on lots. That’s aside from the 117-day supply of Jeep Compasses, up 11 days from February.

While GM averages an 86-day vehicle supply, GMC has a 149-day supply of Canyons and a 125-day supply of Sierras. Chevy dealers hold 102 day’s worth of Silverados and 101 day’s worth of Colorados. Saturn lots are clogged with 214 days’ worth of IONs and Pontiac dealers are feeling the Vibes for 129 days. Meanwhile…

The average Toyota had a 46-day shelf life. Nissans disappeared in 67 days. Even last month’s lot queen, the Mazda B-series truck dropped from a 229 to a 183-day supply. Once again, the Honda Fit led the pack with just 13-day's supply ready for sale.

In sales per dealer (SPD), Toyota once again topped the chart, up 39 sales to 175 SPD. Surprisingly, Ford averaged more SPD than Chevy (57 vs. 52). At 38 SPD, Dodge led the way for Chrysler Group. In contrast, Mercury dealers moved seven units apiece. Once again, Buick set the floor, averaging only six sales per dealer.

Three manufacturers saw full-size pickup sales increase from February to March: Ford (up 16.2K), Dodge (up 9.6K) and Toyota (up 3.5K). After a healthy jump from January to February, total sales of GM’s newly- launched GMT900 pickups decreased by 4.7K units in March.

Considering increased Sierra and Silverado inventory levels, and a sales decrease against its competitors’ increases, this could be an early indication of serious problems to come. Unless GMT900 pickup truck sales pick up or GM cuts production, we’re looking at a significant summer clearance sale. Any price reduction would likely be met in kind, leading to the beginning of the end for full-size pickup truck margins (as previously predicted here).

At the same time, domestic manufacturers have been slow to offer suitable alternatives to their larger and more profitable trucks. It may be too late to regain lost ground. In March, domestic light truck sales sank 4.8 percent while more economical imported light trucks rose 18.3 percent. GM’s small pickups—the Canyon and Colorado– fell by 14.6 and eight percent respectively. Toyota’s Tacoma is up 16.5 percent.

Taken as a whole, March’s sales figures indicate that the domestics are still struggling to stem the transplants’ ceaseless onslaught. The trend toward downsizing also continues, although perhaps not as radically as some have predicted. 

Next month, TTAC’s launching some new methodology. I’m trending sales for selected vehicles from The Big 2.5 and Toyota in four different categories: Passenger Cars, Full-sized Trucks, Truck-based SUVs, and Car-based CUVs. I’ll post graphs showing the comparative results along with data from the same time last year. This should give us greater insight into sales trends across brands and models.

If Toyota is the new GM, Kia is the new Toyota. After establishing a U.S. beachhead with price-oriented products, the Korean automaker has gradually expanded its reach by replacing its penalty boxes with vehicles sporting upmarket features and class-leading safety, while maintaining the brand's value promise. The Rondo is yet another example of the kind of mass market machine The Big 2.5 should be building, but isn't.    

Once upon a time, a loafer-wearing businessman buried the front end of his rented Oldsmobile in a dune on the barren southwestern point of Galveston Island. I retrieved my Jeep Liberty and drove it to the Olds across a sea of tidal dunes carved into the coast like three foot swells; the Liberty loped from crest to crest in a spray of sand. Within minutes, I dug out enough of the Olds’ front bumper to affix a strap and pull the trapped car onto smooth packed beach. So how does this Jeep lover rate the prospects for the new 2008 Jeep Liberty? D.O.A.

Codenamed KJ, the current Jeep Liberty came to market in 2001 as an ‘02 model. In the U.S., its introduction overlapped production of the ancient, outgoing Jeep Cherokee by about six months. It was a sensible move; dual production kept the assembly lines running and assured the new Liberty a soft launch to major league success. The Liberty has been America’s best selling compact SUV since 2005.

The redesigned 2008 Liberty, code named KK, will roll off the assembly line this fall. Looking to revive the Cherokee’s now legendary styling, the KK is shaped like a brick on wheels. Aficionados have dubbed the new Liberty a mini-Commander (Lieutenant Commander?). In case you’re wondering, that’s about as far from a compliment as a Jeep lover can get without dropping the F-bomb. The Commander, an unmitigated sales disaster, is being quietly dropped from Jeep’s multi-model roster.

But questionable looks aren’t the only reason why the Liberty’s segment-leading success will soon be over. The new Liberty is destined to be a dud because the existing Patriot and four-door Wrangler Unlimited will cannibalize its sales.

To test my suspicions I turned to L.O.S.T. (Liberty Owners Special Team). Most of this club and web forum’s members are apex users; they modify their cute-faced grocery-getter with lift kits and larger, knobbier tires and take them to places that SUV critics say SUV owners never go. The members’ antics prove that the current Liberty’s solid frame, low gear transfer case and stout-hearted rock crawlin’ engine make it a “real” Jeep.  

Granted, this hardcore owner group’s behavior doesn’t represent the mainstream suburban Liberty owner. But L.O.S.T. members are living the dream that draws all of the lifestyle wannabes to the brand.  I submit that their leading-edge opinion is a good bellwether of the platform’s future. So I polled their website’s visitors about the new Liberty’s place within Jeep’s lineup.

Although the survey was unscientific and the sample population small, the results were decisive. By a factor of two to one, L.O.S.T. members said they prefer the new four-door Wrangler Unlimited over the forthcoming KK Liberty (62% Wrangler, 29% Liberty).

No surprise there. Most of these owners purchased their Liberty because it’s the best compromise between off-roader and family taxi. Now that the Jeep Wrangler’s ride has been greatly improved and can plausibly seat four passengers, it can pull double duty. And so it will.

Again, most Liberty owners are not mud-plugging militants with dirt, grease and blood under their fingertips. The model’s sold to well manicured urban and suburbanites seduced by the Jeep’s round-eyed headlights and smiling bumper; buyers so smitten by the Liberty’s cuteness that they ignore the harsh ride, heavyweight handling, cramped quarters and horrendous gas mileage.

Those days– and sales– are numbered. The new Lego-shaped Liberty has the cuteness quotient of a shoebox. Of course, such stylistic determinations are subjective. But beholders with an eye for sassy will more likely find Jeep’s own Patriot or even [dare I say it] Compass more suitably adorable. Furthermore, the non-jeep Jeep twins are less expensive and more fuel-efficient. They’re better “cars.”

And consider this: Jeep now sells seven models in the U.S. The situation is so confusing that the brand’s American website has a widget to help a Jeep buyer “find the vehicle that best matches your needs by selecting your preferences from the filters below: Price Range, Seating Capacity, Towing Capacity.” Select the $20k to $30k price range from the drop-down menu and… all seven models remain highlighted.

Put another way, a customer with $25K burning a hole in their pocket can purchase a Patriot Limited AWD, Liberty Limited, Grand Cherokee Laredo or Wrangler X. How’s THAT for model overlap and price point confusion?

Jeep is generally regarded as the Pentastar’s crown jewel, the one brand that’s survived its German owners’ neglect and mismanagement relatively unscathed. As the Commander and new Liberty prove/highlight, DCX has somehow found a way to kill the golden goose. They’ve diluted the brand’s carefully crafted off-road image while failing to produce a credible competitor to Toyota’s RAV4 or Honda’s CR-V. If anyone wonders why Chrysler’s on life support, well, there’s your answer.

GM circa 2007: bad investments and expensive labor contracts; excess capacity and crushing debt; a surfeit of brands and products. It’s also GM circa 1910, 1920, 1973, 1980, 1991 and 1998. In fact, wandering through GM’s history is like watching an endless loop of "Groundhog Day." Clearly, The General doesn’t share Phil Conners’ ability to learn from its mistakes. Can there ever be a happy ending for The General?

Automotive pioneer Billy Durant created General Motors by assembling a group of carmakers in the 1900’s. By 1910, his hands-off management style and buying spree left his creation high and dry. Durant’s backers jettisoned the conglomerate’s founding father. Bankers refinanced GM. Durant regained control in 1915 and restarted the cycle. In 1920, GM was broke, Durant was canned and GM got off the treadmill.

Under the watchful eye of Alfred P. Sloan, GM became an industrial juggernaut. The domestic automaker carved out a 40 to 50 share of the U.S. car market and never reported an annual loss (until 1980). But there was a dark side to GM’s fifty plus years of dominance: the company became fat, dumb and lazy.

The causes of GM’s cyclical mismanagement are rooted in the company’s– indeed Detroit’s– Golden Age. During the boom times, GM was a conglomeration of enormous semi-independent enterprises, all contributing to one big bank account marked “GM profits.” This structure worked well enough in an expanding market with few competitors. 

Despite the logo on their paychecks, the people within this corporate amalgam weren’t loyal to GM. They worked for Buick, or Fisher Body, or Delco, etc. GM gradually evolved into a maze of deeply entrenched hierarchies and fiercely competitive fiefdoms. Workers and management attended to their own interests or the interests of their unit, rather than GM as a whole. Any attempt at altering the status quo was greeted with “what’s in it for me/us?” rather than “Is it good for GM”?

The resulting bureaucracy lacked speed, strategy or shared motivation.

The ‘70’s oil shocks gave GM its first fish slap in fifty years. As GM’s lineup of gas guzzlers and uncompetitive small cars lost out to upstart foreigners, the company’s fortunes began a worrying decline.

In GM’s ossified corporate culture, only one recipe for “change” could satisfy all factions. Ignore problems (protect the status quo), fire workers (reassure Wall Street) and tout the Next Big Thing (deflect everyone’s attention from This Big Mess).

So The General laid off workers, demanded more from remaining employees, built more barges and waited for oil prices to drop. By the mid ‘70's, the imports had gained a secure foothold in GM’s backyard. To stop the rot, The General closed more plants, laid off more workers and declared that its new downsized FWD cars would ‘push Japan back into the sea.’

Faced with GM’s Byzantine bureaucracy, top management tried to foster change through big initiatives. This pattern hit its zenith when Roger Smith (of "Roger and Me" fame) led GM during the '80's. After a massive reorganization in 1984, Smith dismissed thousands of workers and began a buying spree of epic proportions.

GM’s CEO spent an estimated $40b on a laundry list of fashionable solutions distractions: NUMMI (New United Motor Manufacturing Inc.), EDS (Electronic Data Systems Corporation), Hughes Aircraft and more. Meanwhile, GM proclaimed that vehicles like the Saturn, GM-10 midsize cars and the Impact EV would reverse their declining fortunes.

GM’s culture ignored the benefits of these innovations. The Toyota-style production techniques learned at NUMMI and the union-friendly ideas implemented at Saturn’s Spring Hill plant never made it outside the factory gates. GM management remained impervious to EDS’ can-do culture. Saturn devolved into another badge-engineered GM platform brand.

During the SUV-based profits blip, GM couldn’t resist the old urge to bulk up, adding Saab, Hummer, Daewoo and parts of Isuzu, Suzuki, Subaru and FIAT to the portfolio. Now, once again, they’ve been caught up the creek without a small car shaped paddle. Once again, the next Beta-Zeta-Gamma-GMT900 will save them. And again, GM has resorted to layoffs (this time with payoffs).

The net result is GM 2007 looks an awful lot like GM 1910 (or 1920 or 1973). By not rationalizing its management structure, brands, product development process, capital outlays and labor contracts, GM has come full circle. Only now it has a 23 percent market share instead of 50 percent. And it’s running out of time and money.

Ironically, Durant’s reaction to the GM of 1910 still seems relevant today, “I saw cherished ideas laid aside for future actions, never to be revived. Opportunities that should have been taken care of with quickness and decision were not considered. The things that counted so much in the past, which gave General Motors its unique and powerful position were subordinated to liquidate and pay.”

How the mighty have fallen.

There are some amongst us who hate auto shows in general and any given auto show in specific. They see the pistonhead conclaves as a soulless smorgasbord of automobiles in aspic, with side tables filled with deep fried hype. I don't share the antipathy. Where else can you go and see PR flacks spinning each other? It's like Paris after 911, when French café waiters were forced to be rude to each other. Oh yeah, and there are lots of cars for dissing, dismissing and, occasionally, drooling. Live, from New York! It's Here's What You Missed!

After years of W-THIST (Where the Hell is it?), Volkswagen is bringing a 50-state compliant diesel engine to the US, nestled into the snouts of the Rabbit and Jetta. Even better, VW has married the brawny diesel (140hp and 230 lb-ft of torque) with their world beating six speed DSG transmission. Best of all, the parsimonious granola eater's oil burner (40 mpg) is an ideal alternative to the thirsty AND anemic 2.5 liter buzz-box currently infesting the U.S. model range. So why not the Passat? 

Dodge has Demons. Rumor has it someone still employed by DCX green lighted this hideous roadster for production. Boil that dust speck! Bargain-basement pricing assures The Dodge Boys another generous helping of razor thin profit margins. If Dodge wants to sell a true Sunday car, they should build one that appeals to the 50-somethings who might actually buy one, rather than Teenage Mutant Ninja Turtles. Ralph Gilles, why has thou forsaken us, bro?

Mercedes unveiled the new C-Class, which is definitely not a German taxi (except when it is) and the 500hp-ish CLK63 AMG Black Series, which will elevate the model into the top ranks of catastrophic depreciation. The C-Class is, get this, sexy. If its dynamics match its demeanor, if it drives more like the brick C-Class of the early and mid 1990s and less like the flaccid, rolling logo of the current millennium, Mercedes salesman will soon be sailing on high C sales. By the seashore.

The CX-F is a drop-dead gorgeous concept car from a Ford subsidiary on the brink of dropping dead. This four-wheeled Hail Mary pass is a radical departure from Jaguar's recent design heritage; it's got about as much to do with the S-Type as American car buyers. Ian Callum was at the New York auto show to talk the talk about how his company's new look can pull it back from the brink. Again. Still. But the CX-F concept car wasn't there to walk the talk. This led to some talk: why does someone want the CX-F to disappear? Or has Jag's ballroom budget been busted?

Audi brought their S5 coupe into the Big Apple, complete with the Audi R8's front end. The side profile is… um… let me check the photos… it is. Taken as a hole, the S5 plugs the last remaining gap in Audi's lineup (the one that helped you understand the difference between the various model sizes). If German pricing is any indication, the A5/S5 will make the A4/S4 look like a Blue Light Special. We're talking $46,639.19 and $63,064.33, before tax, title, registration and floor mats.  

Lincoln's MKR concept revives the great American tradition of gaudy, sci-fi showcars. Luckily, only the Twin-Force (twin turbo six) powerplant is slated for production– despite rumors that the gargantuan grille may someday see service. The concept allegedly makes 415 horsepower, so we can bet on a final number closer to 315hp when all's said and done. If Ford pawns off Jaguar, Lincoln might actually be allowed to build its own cars again. If so, this engine– not the wacky sheetmetal– will help guide Lincoln's stewards towards what a luxury car should be.

Surprise! Kia didn't have the most exciting cars on display at the New York auto show. I wanted to ask a flackling a few questions, but their display was all about Pink Floyd. Is there anybody out there? out there? out there? Nope. The Kia Rondo taxi cab concept spoke for itself. As the Ford Crown Vic dies, the taxi fleet market is looking for the next cheap thing. With no upmarket retail image to sully, Kia would be happy to oblige.

Last but least, Toyota showed the ugliest car Toyota has built in recent memory. Whereas the new Camry and RAV4 sit somewhere between bland, sharp looking and modern, the new Highlander runs the gamut from vile to noxious to Nosferatu. Not to put too fine a point on it, it's a rolling emetic. 

Strange to say, Toyota's becoming more American every day. Think about it: too many overlapping products (Highlander, RAV4, 4Runner), expecting ugly cars to sell on their strong brand name (Highlander) and investing in new SUVs while gas prices ascend to the heavens (Highlander). See? Another great reason to go to the show: you can watch assimilation in action. Or is that inaction?

In the first three months of his employment, Ford CEO Alan Mulally earned himself a cool $28.2m. So how’s the high flying ex-Boeing exec doing in his campaign to save the embattled automaker? According to Big Al, “it’s going pretty well." He’s “reduced complexity” (i.e. paid bureaucrats to leave), sent Aston packing, unloaded the first of thirteen surplus-to-requirements Visteon plants and started to make good on cost savings targets. On the income side of the ledger? Not so hot.

Earlier this week, Ford flackmeister George Pipas proudly proclaimed that FoMoCo market share is now, finally, Thank God, stable. His underlings trumpeted “record sales” of The Blue Oval’s mid-size Mexican troika and Canadian crossovers. The Fusion had its strongest month ever; 15,790 units made a run for the border. The Edge is selling at a level deemed “comparable to long-established crossover products,” boasting 37 percent increases in the U.S. and doubling in Canada. 

The company now hopes (against hope) that the badge transmogrified Taurus and hot-off-the-press Flex will generate interest in all things “Dave” and jump start the automaker’s entirely theoretical nascent sales recovery. Never mind product overlap. (Ford will have three identically-sized crossovers— Edge, Taurus X and Flex—with identical powertrains.) Feel the buzz.

Meanwhile, it’s flat tires at all four corners. The Glass House Gang has just completed its fifth consecutive month of dismal sales and declining market share. 

Given the housing slowdown and sub prime debacle (Big Al: “It’s a concern”), the pinch is being felt damn near industry wide. Ford is faring worst of all. A quick glance at the less shiny numbers indicates that FoMoCo is on pace to move just over 2.5m units this year, roughly 400k less than last year. Nine percent fewer FoMoCo products hit the street in March ’07 than in March ’06. Rounding out the first quarter, 13 percent fewer people have bought a Ford, lately.

The usual sales stalwarts, the Mustang and Explorer, are facing declines of 17 and 26 percent respectively. Most disturbing, Ford’s cash cow has come a cropper. The F-Series pickup has been knocked from its perch as America’s best selling pickup, into the dirt. Year-on-year March sales are down 15.1 percent to 71,481 units. And consider this: the numbers represent the F-Series’ best sales month since August 2006.

Ford’s new ads stress the F-150’s competitive strengths, but it’s not just a matter of keeping traditional Ford customers from opting for Chevy, Dodge and Toyota pickups. It’s a question of getting people to come on down.

CNW Marketing Research reports that automotive showrooms are emptier than Paris Hilton’s panty drawer. Other than Toyota, every major automaker’s dealers are seeing less foot traffic than the year– or month– previous. Ford suffered the most from the footfall freefall. Showroom floor traffic sank 18 percent in January, and then slid roughly 28 percent in February and March. Even a 450 horse F150 sold by the CEO himself won’t cure those kind of numbers.

The Detroit News reports that The Big Boss is pressuring Mark “Movie Star” Fields (El Presidente del Americas) and Cisco Codina (group think vice president for NorAm Marketing, Sales and Service) to initiate a “full court press” to win back the masses. Failure is not an option. There’s been talk of kicking Mark Fields off the corporate jet (saving the company some $5.75m in executive over-compensation) and replacing Cisco Codina with customer service president Daryl Hazel.

Ask the Ford family scions who’ve seen half a billion dollars wiped off their stock value and their dividends disappear. All this corporate turbulence sucks. But it’s nothing compared to the UAW-shaped storm cell that lies dead ahead. 

If Mulally can wrest significant concessions from the United Auto Workers this summer, he'll be worth every penny of his $30m salary. The problem is his $30m salary. Quite how Big Al expects the rank and file to take a hit for the team when he’s banking tens of millions of dollars, while his family enjoys free corporate jet travel, is an interesting question. Perhaps not as interesting as “Why can’t the workers have some of those billions you borrowed?” but close.

Yesterday, Mulally warmed-up for the Ford – UAW Detroit Death Match by announcing that The Blue Oval Boys don’t have specific targets for wage and benefit concessions. Nope. They’ve got a non-negotiable "economic envelope for competitiveness."   If you could read the back of that envelope it would probably say “we can't pay you now so we'd like to pay you later.”

In truth, Big Al doesn’t have a hope in Hell of convincing Big Ron’s team to offer anything other than window dressing. Without increased sales or decreased labor expenses, Big Al will fail. He may even get fired— provided Ford can afford Mr. Mulally’s $27.5m severance package.

It’s déjà vu all over again. GM’s sales sink, the PR flacks weave a tangled web and the product guys dangle shiny objects in front of the easily distracted press to prevent them from focusing on the company’s ongoing, unstoppable rot. It’s got to the point where Buickman, the original tin foil hat guy, can’t be bothered to pen his usual protracted rant. All we get is three sentences, the first of which proclaims “Need anything more be said?” Well, yes actually. It’s time, once again, to talk about small cars.

It’s no revelation that GM is, was and will be ill-prepared for rising gas prices and increasing demand for smaller, high mileage vehicles. Back when they launched their “new” GMT900 based SUV’s, ttac.com (and everyone else) pointed out that The General had arrived late to the high mileage ball dressed in an oversized clown suit.

That was over a year ago. By now, GM should be at least two years into a small car project (or five), getting ready to stun the market with a Fit-killer, a Versa adversary and a Yaris crusher. And?

And now Chevrolet is running an on-line competition where consumers can choose between three foreign-made mutant micro-cars: the Beat, Trax and Groove. You know, hypothetically. ‘Cause they’re concept cars.

For the next two years, consumers looking for GM’s mark of excellence on a high mileage vehicle are still left with a choice of fuel-gargling SUV’s and pickups, marginally less thirsty crossovers, a wide selection of anemic rental grade sedans, a couple of ergonomically challenged toys (a.k.a. roadsters) and a small range of joyless (if frugal) penalty boxes.

Remind me again: who’s surprised that GM’s March sales are off seven percent from last year, while Toyota’s climbed 11.7 percent, Honda grew by 11.3 percent and Nissan increased 7.8 percent? Well, no one really– save those misguided souls who think the inherently unprofitable (and anemic) Opel Astra will take the US market by storm.

Nope. The miscalculations of the past continue to haunt GM, arguably the least agile automaker on the face of planet earth.

This is the point where I usually trot out one of GM Car Czar Maximum Bob’s inane auto show pronouncements, illustrating the fact that GM is so far behind the curve they’d almost be better off waiting until motoring trends come full circle. Something like, "The real question is will we build these types of vehicles in the U.S.? Historically, these types of cars haven't done well here. But clearly, things are changing."

Normally, I’d segue into a statement about GM’s inability to catch up with the transplants’ constant evolution with timely, segment leading products. But I've discovered a far better example of The General's general cluelessness and temporal distortions, courtesy of GM’s vice president of global design.

"I think American, and [I think] big," pronounced Ed Welburn at this year's New York Auto Show. ”Big has been very much a part of America. The highways are wide, the parking lots are quite large, but the interest level is there for a smaller car…

“I think it is time, especially as people are looking for a unique offering, to be a very creative, or to at least look at a very creative offering in the small car category."

Ed is certainly a corporate survivor, but who knew he spent the last five years as a survivor on a desert island, away from the U.S. automotive marketplace? GM's going to “look" at the "possibility" of building a creative small car? As John McEnroe would say, YOU CANNOT BE SERIOUS!

He is. They are. Incredibly, a full year into an unstoppable downsizing trend amongst American car buyers, GM’s still “thinking” about the whole small car thing– while the transplants are busy gorging themselves on The General’s lunch.

Given the now familiar litany of lost sales and declining market share, this parlous state of affairs leaves GM PR flacks without a coherent story to tell. In other words, there’s spin to be spun.

“In March, we saw continued strength and stability in our retail business led by gains in mid-cars, crossovers, economy cars and luxury SUVs," said Mark LaNeve, vice president, GM North American Sales, Service and Marketing.

"The Chevrolet Silverado, GMC Sierra, Acadia and Saturn Outlook are exceeding our expectations and confirm that when you offer the best product, value, segment-leading fuel economy and the best warranty coverage in the industry, customers respond."

While we’re happy GM’s exceeding their own “expectations” (a meaningless measure if ever there was one), and we’ll defer to Frank Williams' monthly “By the Numbers” editorial to provide the obvious truth behind the hype (a few bright stars do not a universe make), suffice it to say LaNeve’s recipe is spot on. In fact, The General’s competition is using it right now to kick GM’s ass.

When will they ever learn? Never. They will never learn.  

Never mind all that “buy American” and “Asian cars are the enemy” rhetoric. The United Auto Workers (UAW) would love to get their hands on the transplants’ southern redoubts. With their numbers dwindling due to Detroit’s plant closures and buyouts, the UAW realizes they have to go trolling in the transplants’ ponds to stay alive. Last Saturday, they tested the waters with a small group of Toyota workers at the brand’s Georgetown, Kentucky plant. The UAW is smacking their lips at the prospect of dining on catfish sushi.

The meeting was the direct result of a major management screw up. In January, Toyota’s leadership discovered that an employee at the plant had unearthed a confidential file on a shared network drive . The document disclosed the fact that ToMoCo's management was discussing "a greater emphasis on variable pay and ways to slow the growth of our labor costs, including the cost of benefits."

The memo recommended that Toyota work to bring its wage structure into closer alignment with other local industries and "not tie ourselves so closely to the U.S. auto industry or other competitors." Translation: Toyota’s higher ups are unhappy that the company’s labor costs (as a percentage of sales) are increasing faster than their profit margins.

Despite Toyota’s attempts at damage control, the press got ahold of the memo. Rather than fess-up and explain their competitive dilemma, Toyota sacrificed a pair of a scapegoats. They fired two Georgetown plant employees for allegedly accessing and distributing the confidential document.

The employees admitted reading the doc (as did several hundred others), but denied sending it to the press. As allowed by Toyota personnel policy, they pleaded their case before a five-member peer review board. The board ruled that they were both innocent. Toyota management overruled the review board’s decision and fired them.

Salting the wounds, Toyota remained silent on any investigations into– or disciplinary actions against– the person or persons who left the confidential document on the company-wide computer network.

As expected, the UAW seized upon this “unpleasantness” to step up their efforts to unionize the Toyota plant, to gain a precious foothold deep in the heart of non-union territory. On Saturday, the UAW hosted a town hall forum entitled “The Human Cost of Toyota’s Success” in Lexington, Kentucky.

About 150 UAW representatives, Toyota employees, members of the press and other interested parties attended the meeting. Even though the Georgetown plant employs almost 7k workers, only five people spoke at the gathering, including the workers who were dismissed over the confidential document. No representatives from Toyota management attended– at least not officially.

The speakers addressed the document’s implications for Toyota’s HR plans. They also aired a number of complaints about the way the Georgetown plant is managed. They asserted that Toyota does not take workplace injuries seriously, that full-time workers have “disappeared” (to be replaced by lower cost temporary workers) and that training opportunities have dwindled to the point of extinction.

Needless to say, it this was music to the UAW’s collective ears. “It’s time for Toyota to sign a contract with us like everyone else they do business with,” Vice President Terry Thurman announced. The man who directs the UAW’s National Organizing department and helped organize the meeting added, “This is all about Toyota workers.”

The sequence of those two statements tells you everything you need to know about the UAW’s priorities. There’s only one reason they’re making a full-court press against Toyota: it’s their only hope for survival. If the UAW has any success organizing Georgetown you can rest assured they’ll start looking for further inroads into the rest of the transplants’ non-union plants.

Even though the UAW stated their Toyota kvetchfest was not an “organizing event,” they now have a foot firmly in Toyota’s door. The UAW and the National Jobs with Justice Campaign plan to capitalize on their success by establishing a Worker’s Rights Board in Kentucky. According to the UAW's press release, this organization “will be available to hear personal stories of Toyota workers and recommend appropriate remedies when necessary.” In other words, they’ll be collecting information they can use to further their attempts to organize the plant.

And they’ll be moving on from there. One worker from the Toyota plant in West Virginia attending the Kentucky meeting asked if the UAW could conduct a similar meeting for workers at his plant. Of course, the union immediately agreed, seizing the chance to get a presence established at a second Toyota location.

Toyota has no one to blame but itself for this perilous state of affairs. Their sloppy record keeping and short sighted damage control could give the UAW the leverage they need to start pulling Toyota into the same rat hole that disappeared Detroit. Meanwhile, even as they seek to organize Toyota, the UAW continues to call the automaker their enemy. And so it is. 

The last time Toyota sold sex-on-wheels it came arrived in the form of the flying flagship known as the Supra. The Supra holstered an inline six with twin turbos sending over 300 horses to the rear wheels (335i anyone?). But Toyota’s mid-market meteorologists knew which way the wind was blowing. So they sent their one trick pony car back to the factory to be made into rubber and glue. Now Toyota has two flagships with the combined excitement of rubber and glue: the granola Prius and the grandpa Avalon.

"We are absolutely going to do what it takes to keep our product fresh and keep it relevant in the market.” Now THAT’S what I’m talking about! A Ford exec making a public commitment to ongoing excellence. No more cut and run. No more vehicles dying on the vine or losing out to some new “flavor of the month.” Oh wait. Ford's truck marketing manager wasn’t talking about keeping it real for the core models. Ben Poore was celebrating the company’s decision to offer a Chip Foose edition F-150. Oh dear.

I’m all for “mass customization.” The MINI and Scion brands nailed it: encourage buyers to give a nice car enough individuality to make it their own– without destroying resale value. But these are niche brands. While the same principle may someday apply to mass market automobiles, most of today’s buyers still frequent dealers with hundreds of roughly similar vehicles waiting for a new home.

And that means that Ford’s big push for “limited editions,” its newfound faith in so-called “microsegmentation,” is yet more evidence that Ford’s fundamentals are broken. The Chip Foose Edition F-150 (450-horsepower 5.8-liter V-8 and Overhaulin’ stylin’), the Shelby GT-500KR (yet more horses for an overpowered death car) and the Funkmaster Expedition (Why not the Funkmaster Flex Flex?). All of these vehicles will do precisely nothing for the sales of the brand’s core products.

I know. They’re fun! They’re exciting! They create “the kind of buzz in the marketplace that keeps companies healthy." Anyway, that’s Ben Poore’s theory. And a plenty popular one it is too; at least amongst the people who really love muscle modded mainstream motors. As far as hard-nosed beancounters are concerned, it’s a less well established principle.

In 2000, Ford flogged some 200K Mustangs. The next year, they offered the 265hp 4.6-liter Bullitt edition. One year and 5582 Bullitts later, ‘Stang sales sank to 155K. In ’03, FoMoCo launched the 305hp 4.6-liter Mach 1. The company sold 9600 of those bad boys. The next year, Mach 1 sales slipped towards subsonic, dropping to 7100 units. Overall ‘Stang sales slid to around 140k units. In short, the hard core variants either cannibalized Mustang sales or did sweet FA to stop the rot. 

Ah, but what of the so-called halo effect? Like many testosterone-crazed auto execs, Poore was implying that way cool Mustangs, F-150’s and Flexible Flyers will create warm fuzzies for the models’ more pedestrian stable mates, or the Ford brand in general, or something. It’s strange to see this trickle down branding concept re-emerge from the Glass House Gang– given that the automaker recently deep-sixed their entire SVT tuning division and pulled the plug on the world class Ford GT supercar.

And fair enough. As we’ve argued before, halo cars are a waste of time and energy that reveal company-killing ADD (Studebaker Avanti anyone?). Sure, Ford’s fire-breathing mutants make US happy. But we’re pistonheads. We love the extreme, the amazing and the unique (ish). Let’s face it: the vast majority of the American car buying public couldn’t care less about a 450-horse pickup truck, or any other wild-ass vehicle. They want vanilla. Plain, old, vanilla.

So never mind all the marketing gobbledygook about intangibles like a special model’s effect on “brand positioning.” At the sharp end, special editions are nothing more than a way to earn the dealer a little extra cash, or provide dealer drive-by props, or give the sales manager a cool car to drive instead of the plain Jane sedan he beats to an inch of its life. Again, you gotta wonder, why bother?

Never underestimate the impact of corporate culture on a company’s priorities. Toyota is on a mass market mission. Does ToMoCo have a halo car? No. Ford is… confused. Their culture is no longer about doing the hard work needed to endlessly improve and promote core vehicles like the Crown Victoria, Escape, Explorer or Freestyle. It’s all about finding a Hail Mary pass that suddenly saves the company from ruin.

High-priced limited edition vehicles are not going to save Ford. They’re not even going to help them. Truth be told, this showboat-load of special edition models only exist because they give Ford’s dispirited marketing and PR folk something “interesting” to do. What’s the bet Ford will provide DOZENS of high quality press pictures of the Shelby ‘Stang— while they remain oblivious to the fact they can’t provide one decent shot of the Focus. Or, for that matter, a decent Focus. Or, quite simply, maintain focus.

Again, don’t get me wrong. I celebrate automotive diversity in all its forms. But someone’s got to remind Ford that their brand isn’t about diversity, or horsepower, or Funkmaster Flex’ fanatical followers, or anything else that smacks of spizzarkle. Ford is about value for money. Period. 

Back in ’98, the BBC aired a fly-on-the-wall documentary series called “Back to the Floor.” A camera crew followed five British bosses who left the relative safety of the executive suite for a week's labor with downtrodden workers at the sharp end. When the show migrated to America’s PBS, it lacked the undercurrent of class warfare that gave Auntie Beeb’s original its zing. When Ford CEO Alan Mulally recently revived this scenario by playing car salesman, the results were equally dire.

Of course, Alan didn’t sell cars for a week. He “worked” for an afternoon at Village Ford in Dearborn, Michigan and Galpin Ford in L.A. Hanging with the Village people, Ford’s top dog supposedly set a blistering sales pace: four cars in forty minutes. Wow! Assuming Ford needs to sell 5.3m cars for a turnaround, Mulally should train 375 salesmen to repeat his voodoo. Working ten hour days, six days a week, they’d return Ford to ’05 sales levels by the end of the fiscal year.

Anyway, Nancy Miner was one of Big Al’s scalps. After a bad dealership service experience in New York (which Big Al didn’t investigate), Ms. Miner decided to go car shopping in Ford's home patch. That said, the main reason behind her journey was a visit with her son Kevin, a longtime Ford employee. Now don’t get to thinking Ms. Miner was a Ford family ringer, carefully prepped for purchase. At least, not according to the debrief provided by the divine Mr. M.

"She was down pretty much to a Camry and the Fusion,” Al said, displaying a car salesman’s knack for data capture. ”So I told her all about the Camry because I've had every Camry, I've had Lexus cars, I know all about Japan. I told her about the [Fusion], asked what her needs were. The Fusion was really for her."

It's a shame Ms. Miner didn’t ask Ford’s CEO why he chose Toyotas and Lexi over Fords and Lincolns for all those years, and whether this sudden change in brand loyalty had anything to do with his FoMoCo-sponsored $35m compensation package (plus unlimited G5 air miles). As opposed to, say, a recent, radical shift in Ford's comparative product quality.

Ms. Miner might also have enquired if Mulally’s all-encompassing knowledge of Japan includes insight into that country's automakers' ability to generate millions of sedan sales without relying on rental, taxi, livery and/or law enforcement fleets. While we're at it, readers with sales experience might like to know why “call me Alan” switched the qualify (ask about the customer’s needs) and present (tell her about the car) parts of the official Ford sales process. Never mind. I guess Mulally is more of a closer. 

Big Al put this proposition to the test at Galpin Ford. Needless to say, the L.A. Ford franchise isn’t one of those Midwestern stores where the tumbleweeds blow across the sales floor and the dealer principal can’t afford to even think about divorcing his second wife. Galpin is, in fact, the world's top-selling Ford dealership. Suffice it to say: fish, barrel, Ford, Mulally.

Once again, “Call me Alan” sold four vehicles. Once gain, little was left to chance. Longtime customer Danny Harrington— 15 vehicles and counting– was teed-up. The general contractor was “warned” in advance that FoMoCo’s top dog would be on site, and took full advantage of the opportunity.

Herrington sat in the room where small pens sign big checks with Ford’s CEO and Galpin Sales GM Terry Miller. The Associated Press reports that Herrington wanted more money for his 2000 F-250. M&M did some pencil pushing and reduced the builder's payment to his target of $600 per month– for six years. Oh, and Big Al clinched the deal by throwing in a set of floor mats (I kid you not).

"There were a couple of things that were in question as to be part of the deal," Herrington said post facto. "I think because of him [Mulally] it went my way."

While the word “think” doesn’t indicate that everything went Herrington’s way, there’s a more important question: what did Alan Mulally learn from this exercise?

Call Me Al didn’t face any of the drudgery association with car sales: waiting hours for “ups,” filling out reams of tedious paperwork, making sales calls to old customers, etc. Nor was he subject to any of the psychological pressures facing salesmen and women: depending on a sale to make ends meet, facing down the GM, competing for bonuses, etc. Nor did he get a taste for a “real” customer interaction; all the prospects knew Big Al was Ford’s CEO. In short, The Blue Oval's Big Boss learned more about PR than people.

In the “Back to the Floor” doc series, the egghead CEO always gained an appreciation for his street smart employees’ difficulties— many of which were the direct result of company policies. The basic idea: something will change. In contrast, Mulally’s flying visit to the front line was a cynical move that changed nothing and fooled no one– except maybe Mulally himself.

As Detroit slips into a quagmire of its own creation, The Big 2.5 are busy flexing rapidly wasting political muscles. On Tuesday, the top brass met with President Bush to forestall discuss plans for greater fuel efficiency. The next day, Senator Debbie Stabenow (D-MI) introduced The Japanese Currency Act. Like her Motown home boys, Stabenow claims the Japanese government is manipulating their exchange rate to provide an inherent– and inherently unfair– “discount” over American-made products. Uh, I don’t think so.

There are plenty of reasons to dismiss this legislation as End of Days insanity. First, there’s the timing. If the yen – dollar exchange rate is such a pressing problem for Detroit automakers, why did Stabenow hang fire until after the recent elections? Indeed, The Big 2.5 has been losing ground to Japanese-owned automakers for decades. If [alleged] Japanese currency manipulation wasn’t a problem ten years ago, why should anyone believe it’s a problem now?

Second, the proposed bill directs the U.S. Department of Treasury to work with the Council of Economic Advisors and the Japanese government to devise a plan to draw down Japan's “excessive currency reserves." The Act is a patently ridiculous effort to interfere with one of America’s best trading partners and a key strategic ally. It’s an entirely theoretic maneuver that’s doomed to failure; the Japanese Finance Ministry is about as likely to embrace foreign dictates as the U.S. Federal Reserve Board.

Third, while government bodies can manipulate foreign exchange rates, there are obvious limits. Remember when the Euro came out and dived against the dollar? Nothing the Ministers could do helped stop the rot. In fact, any country with open capital markets can only slow currency valuation trends– not create, prevent or stop them.

Even if the Powers that Be conspired to set the Yen at a more Detroit friendly level, the impact on the U.S. car industry would be minimal. The Automotive Trade Policy Council– a Detroit political mouthpiece– says the exchange rate delivers a $4k to $10k per vehicle “windfall” to Japanese automakers. Even if you accept this logic (and forget about the cost of Japanese labor and transportation), we’re talking about a tiny slice of the Dai-san’s U.S. business.

Ironically enough, Japanese automakers moved most of their production overseas in the mid-‘90’s to head off the impact of the (then) strong Yen. Nowadays, only Toyota’s Lexus and Scion models are made exclusively in Japan. Honda’s CR-V is their last home-grown U.S. export– and they’re shifting production stateside. While a rate-based “discount” on transmissions and some electronics (the major imported components) may help, their competitive advantage is not what you’d call overwhelming.

And what of the reverse? While virtually all its factories are in Japan, Mazda has not been able to lift up Ford. If a Japanese production base gives foreign automakers such a large cost advantage, why did GM and DCX recently cut ties with their Japanese “little brothers”? If access to cheap Yen is truly a great advantage, why are Isuzu and Mitsubishi wallflowers at the automakers’ ball? 

Abandoned by their foreign “partners”, these Japanese automakers have been unable to hook up with new partners– and it’s not for lack of trying. Suzuki has apparently decided to use whatever Yen-based “advantage” they possess to make a big push in the Japanese domestic market. When the one Japanese carmaker with no US manufacturing capacity makes its major market push outside the U.S., it tells us that the days when “made in Japan” meant cheap (in any sense of the word) are long gone.

So why does the Yen remain relatively weak, when the Euro and Pound are getting stronger? While most Japanese car and electronics makers are doing well (some more than others), the Japanese economy is in the same slump it’s been in for the last 15 years. Despite government rates that are a tenth of those of the US and Europe, Japanese banks are still “weak.” They’re still saddled with tens of billions of dollars worth of outstanding loans made during the economic “bubble” of the late ‘80’s. Loans they can’t afford to write-off.

Bottom line: Japanese banks aren’t lending much money. Japan’s economic growth is practically flat, with a shrinking and aging population. What’s good for Lexus– a booming Japanese economy– ain't happening.

If the The Japanese Currency Act is so wrong, so late and so feckless, why make the gesture now? The timing doesn’t match plant closings. It doesn’t smack of Big 2.5 Head-Honcho-dom; the Fat Cats only complain about exchange rates when they need a convenient excuse for lackluster sales.

Nope. The bill’s likeliest target are the people most in sync with its paranoid xenophobia: the United Auto Workers. To this receptive audience, Stebnow's Act makes it sound like “something is being done”. Which is true enough: precious time and energy are being wasted on an unimportant non-issue.