Subtitle two: we don’t believe a word of it. The report comes from an exclusive interview of GM Chairman/CEO Ed Whitacre at the Volt fanboy site gm-volt.com. GM-volt’s Lyle Dennis asked Whitacre if GM would lose money on every Volt it sells, a fact that GM executives have never triedto substantively deny. Until now. Whitacre’s answer:
“We’re not in business to lose money,” he said. “We did enough of that already.”
The Volt “is going to sell in the low 30s,” said Whitacre. “We’ll get a margin on that.”
Oh really? Because it sure seems that GM plans on selling the Volt for $39,500-$45,500, and that the “low 30s” number is dependent on a tax credit. As for Whitacre’s claim that the Volt will make profit, the lack of time-constraints on his prediction is all you need to know. With enough sales and over enough time, almost anything will create profit, especially if the government is distorting the battery market for you. Meanwhile, GM still has to overcome $40k sticker shock (sorry, but you can’t exactly advertise post-tax break prices) and at least a few years of loss on the Volt. But if the gm-volt comments section proves anything, it’s that you can never go wrong misleading the fanboys.
It’s been a widely-shared opinion among TTAC’s writers for some time that GM should have used its bailout and bankruptcy to cuts its brand portfolio to Chevrolet and Cadillac. We’ve already sussed out the negative side effects of trying to hold onto the Buick-GMC dealer net, the biggest of which is that without Pontiac, Buick is being forced into volume-chasing. With the debut of the Granite “Urban Utility Concept,” we’re seeing the same brand-diluting volume-hunting taking place at the “Professional Grade” brand. GM’s attempt to bring more youth and volume to its GMC brand is starting with a Youtube-heavy, family-oriented marketing campaign, pointing the way for the brand to betray its “Professional Grade” raison d’etre. But GM’s marketing plan for the Gamma (Aveo)-based Granite will be the final nail in the brand’s coffin. Because to save the brand, GM must destroy the brand.
Even with a government-mandated arbitration process in place, the battle between Chrysler and its 789 culled dealers is a low-down, dirty dogfight. Last week, Chrysler sent out letters to all of its rejected dealers, in its attempt to comply with the arbitration law’s disclosure requirements. But, dealers tell Automotive News [sub], those letters are justifications, but not explanations. Absent concrete evidence for why their franchises were closed (something GM has provided to its culled dealers), lawyers for some 65 rejected dealers are fighting back.
A large part of TTAC’s mission is pulling aside the curtain on the industry, exposing the humans behind the cars that make up our everyday lives. Automobiles have always reflected something of the individuals and cultures that created them, so it’s fascinating to see the different personalities that go into running the world’s automakers. Still, as paid executives, their performances are usually polished to a high sheen; the folks behind you favorite car blogs on the other hand, not so much. The interplay between the two is often as revealing as it is entertaining. Can’t get enough? The complete session is available at joelfeder.com.
A lot of what you hear about Steve Girsky sounds decidedly positive: an outspoken critic of GM, Girsky lasted less than a year as Rick Wagoner’s “roving aide-de-camp,” reportedly due to frustration with management heel-dragging. He even earned TTAC’s “lesser-of-two-evils” endorsement to be Presidential Car Czar over Steve “Chooch” Rattner. When he was appointed to be the UAW rep on GM’s board, representing the union’s VEBA trust which owns 17.5 percent of GM’s stock, he was lauded as someone who could keep his union allegiances at bay. But as special advisor to GM CEO/Chairman Ed Whitacre, Girsky had better be prioritizing GM’s best interests. Reuters reports that he’s being paid a cool $900k in stock grants for his advice. That’s in addition to $200k director’s salary and reimbursement for “living expenses and travel to and from Detroit.” Not bad considering the fuss people are making over compensation at TARP-recipient financial institutions.
Sort of. At least she might have if my esteemed fellow bloggers had let her get a word in edgewise. No wonder GM seems to have such a low opinion of the “well informed.”
Anyway, the clip’s money quote comes at 1:47, when Docherty lets out the classic Freudian slip: “the last competitive product I spent a couple of weeks in was the Acura TSX.” Whoops!
GM sent Opel “an additional $930m in temporary aid until more permanent financing can be found” (good luck with that,) GM disclosed in a filing with the SEC. The total financing GM has provided to Opel now stands at $1.83 b, writes the DetN. It’s not that GM sent the money out of the kindness of their hearts. (Read More…)
My commitment is to the American taxpayer. My commitment is to recover every single dime the American people are owed… We want our money back and we’re going to get it.
Without even getting into the politics of President Obama’s proposed “financial crisis responsibility fee,” it’s easy to see that the initiative holds a wealth of implications for America’s TARP-recipient automakers. In Obama’s new rhetoric, taking TARP money put businesses in a new category of special obligation to the taxpayers. Though the fee is targeted at financial institutions, the principle applies just as much to Detroit.
According to our data, the full-size pickup segment declined by 29.4 percent last year. Of all full-sized pickups, the Chevy Silverado lost the most volume, dropping 32 percent and an eye-popping 148,521 units compared to 2008. GMC Sierra dropped 33.6 percent, or about 56k units. Overall, GM shed half a million pickup sales last year, as its total truck sales fell to 1.2 million. When you’re losing that kind of volume in a shrinking segment, you know it’s time for a hold-em-or-fold-em moment. According to the Detroit News, GM is doubling down on its full-sized truck ambitions, allocating “several hundred million” of your tax dollars towards a re-working of the GMT 900-based trucks.
GM’s Australian Holden division has been developing the kind of big-bore RWD vehicles we tend to think of as being quintessentially American for quite some time. But every time GM hints at repatriating one of these old-school machines to its spiritual homeland in the states, something goes terribly wrong. One classic example of this disfunction was the offshoot of GM’s last effort to bring Holdens stateside as the Pontiac G8, the G8 Sport Truck, a rebadge of Holden’s Ute. The travails of the G8 have been well documented, but the Sport Truck was killed before it even had the chance to lose GM money and be cut along with the Pontiac brand. Now, just as the memory of that savage tease was fading, GM’s Mark Reuss reveals that the El Camino could be back after all.
“I’m optimistic that it’s going to happen,” Wale told the Freep reporters on the sidelines of the Automotive News World Congress in Detroit. “Tengzhong is not an established manufacturer and that’s an issue that needs to be addressed with the Chinese regulators.” Uh-oh. (Read More…)
Kevin Wale, president of GM China, is convinced that China has passed the U.S. for good as the world’s largest auto sales market. He expects China’s growth to continue, creating a gap that will be too large for the U.S. to close, says AP.
As reported ad nauseam, vehicle sales in China last year rose 46.2 percent to 13.64m units. For this year, cautious industry association projections expect somewhere between 15m and 16m units to change hands.
Wale thinks Chinese auto sales will be anywhere between 14.5m to 15.5m by the end of this year. For the U.S., analysts predict 11.5m to 12m.
Very optimistic analysts reckon the two countries could be trading places until 2015 when China firmly takes the lead. Wale isn’t one of them. He doesn’t think the U.S. will ever regain the lead. (Read More…)
According to the Detroit News, production of Hummer H3 and H3T models at its Shreveport, LA plant will stop on Monday, as the in-limbo brand watches its sales collapse. H3 and H3T models account for about a quarter of the Shreveport plant’s capacity, and Colorado and Canyon platformmates will continue to be produced. Meanwhile, the deal to sell the Hummer brand to Chinese firm Sichuan Tenzhong remains unconsummated, reportedly held up by the Chinese government. So when will Hummers go back into production? “When a sale is complete, once marketing kicks back in and there is new interest and enthusiasm, production will fire back up,” says a Hummer spokesman. In other words, never. It’s been a fun ride, Hummer. Thanks for the memories!
Oh, the sad saga of the Pontaic G8. GM finally built a vehicle worthy of Pontiac’s sporty pretensions, only to can the whole brand months later, leaving the G8 orphaned. Which was crummy for enthusiasts, but ultimately a good thing for GM’s business as G8s were assembled in Australia and shipped over to the US, bleeding profit margin all the way. Then came news that a G8-alike would be built in North America, but would only be marketed to police fleet buyers as a Caprice. “Insult to injury!” shrieked the slighted fans of V8 RWD sedans. What they didn’t realize was that GM was still in injury mode. For the real insult, we turn now to the Carpoint.com.au [via Jalopnik], which reports that consumers can still buy new Pontiac G8s. In Australia. Sort of.
GM has a tough row to hoe in 2010, with the launches of key products like the Cruze and Volt going on sale, an IPO to worry about, and a sales slide (down 30 percent for 2009) to reverse. Still, according to GM’s new North American boss Mark Reuss, navigating the congressionally-mandated dealer arbitration is the top challenge of the coming year. At a speech last night, Reuss told reporters from Automotive News [sub] that:
I welcome this as an opportunity for GM and the dealership network to go through a change in our network with integrity,
As opposed to the arbitrary bankruptcy-era dealer cull? (Read More…)
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