I can’t say that I was completely surprised when, about two thirds of the way through Bob Lutz’s new book Car Guys vs Bean Counters, I caught a sideswipe at myself and The Truth About Cars, which the retired Vice-Chairman of GM describes as

a Web site that often offers anything but.

After all, TTAC and “Maximum Bob” have long been sparring partners, and were indirectly debating the fate and fortunes of General Motors well before I ever started writing about cars. What was surprising was that this passing shot at TTAC’s credibility would actually help bring us, two presumptive arch-enemies in the world of automotive ideas, to a better understanding of each other. The exchange that a single paragraph prompted taught me that, against all odds, Bob and I share a fundamental character trait: we are at our best when we’ve been goaded into action by a no-holds-barred call-out. In celebration of this shared value, let’s take off the gloves and give Car Guys the unflinching look it deserves.

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The WSJ [sub] reports

California regulators want zero-emission vehicles—those that don’t run on petroleum—to comprise up to 5.5% of new-car sales in the state, or roughly 81,300, in 2018. The target would rise annually to 14%, or more than 227,600, by 2025…

Tom Cackette, chief deputy executive officer of the California Air Resources Board, says his agency’s goal is to test whether electric cars can become mainstream vehicles, or wind up serving a “niche” market. Mr. Cackette said the state is investing in charging stations and other infrastructure, and he pointed to the sales of new plug-ins on the market to show that there’s a demand for the vehicles. He said he believes the California targets are feasible.

“That is a question we’ll only find out by trying,” he said. “I think [car companies] are making a pretty big investment in these vehicles, and they wouldn’t be doing that if they didn’t think there was a market there.”

Industry lobby groups are pushing California to roll the ZEV mandate into the forthcoming national CAFE standard. Small automakers like Mazda complain that placing a California ZEV mandate on top of national emissions standards would create a “costly burden…in light of the uncertain marketplace and infrastructure for electric vehicles.” And since CARB is leading the federal government by the ear towards a national standard anyway, it could simply push for a higher CAFE rate, which would at least allow firms the flexibility to comply on their own terms. Adding a major ZEV mandate won’t fundamentally change the national standard, but it absolutely will force automakers to spend huge amounts of money to develop a kind of vehicle that has major shortcomings, is only as green as local electricity generation, and has yet to prove itself with consumers. Whatever you think of emissions standards increases, it should be clear that consumers should determine what mix of technologies can best serve their needs while lowering fuel consumption and pollution.

I’m not in the business of helping people Tweet better, I’m not in the business of helping people post to Facebook better. My job is to make sure we keep people safe behind the wheel. I’m not going to deny the fact that people want these things. They do. Especially the generation behind us. They’re used to being connected 24 hours a day.

A car is not a mobile device — a car is a car. We will not take a backseat while new telematics and infotainment systems are introduced. There is too much potential for distraction of drivers.

NHTSA Administrator David Strickland took the war on distraction to the enemy in a speech to an auto technology conference, reports Bloomberg. With nearly every manufacturer racing towards ever greater implementation of connectivity, communication and entertainment systems in cars, Strickland’s rhetorical line in the sand foreshadows a serious confrontation between industry and government. Either that, or this is just Ray LaHood-style hot air calculated to make it look like something’s happening.

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Bloomberg reports that a “person familiar with the matter” says the US Treasury won’t sell its remaining stake in GM as long as the automaker trades below its $33/share IPO price. Previously the government’s auto team had said it would not try to “time the market” and our analysis showed that the Treasury was likely to sell sometime late this Summer. But it’s been months since GM spent more than a few days above its IPO price, indicating that Treasury may be waiting considerably longer if the IPO-price floor is set in stone. And with $36.5b in cash equivalents on hand and only $5b in debt, GM’s $45b market cap is hardly encouraging… especially with investors waiting for The General to match Ford’s profitability levels. Heavier discounts mean a lower operating profit for GM in the US market, and the first quarter shows a $1b swing in pricing between the two firms (with Ford improving $700m and GM dropping $300m) according to Bloomberg. Lower finance earnings are also holding The General back relative to Ford. So, what’s GM’s response?

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The Detroit News snagged a lengthy interview with GM CEO Dan Akerson, giving observers one of the first in-depth looks at the man who will be leading The General for the next three to four years. The interview is to lengthy to summarize here, but there are a few items that are worth noting…

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Rumors began surfacing about a month ago that Mazda was eying a complete pullout from US production, as it endures weak sales of its last American-built product, the Mazda6. Mazda had reportedly planned for 100k units of Mazda6 production at its Flat Rock plant, which it shares with Ford, before the economic crisis sent the US market tumbling. And with only a little more than 36k Mazda6s built alongside the Ford Mustang at Flat Rock last year, Mazda has little reason to maintain its joint venture, and with it, its US manufacturing presence. Now, the Nikkei [via the DetN] reports that Mazda’s pullout is more likely than ever, citing an unnamed Mazda source as saying it hoped to sell its 50% stake in the Flat Rock AutoAlliance plant to Ford as it restructures its global operations.

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UAW Boss Bob King spoke to Detroit Regional Chamber’s Mackinac Policy Conference about what he calls “The 21st Century Union,” arguing that “the union has changed and we challenge business to change with us.” But while King talks cooperation and mutual benefit, his union is preparing for what promises to be a tough fight with the automakers to create a new contract that deals with the shop floor poison of the two-tier system, securing union representation on automaker boards, and rolling back union concessions without sending automakers back towards bankruptcy. Kings words are worth listening to and considering, but the upcoming contract negotiations will be the ultimate measure of the UAW’s professed changes.

AutoNation boss Mike Jackson has long been the front runner to inherit Bob Lutz’s mantle as the most opinionated guy in the car business, and recently he’s been moving to lock up the distinction. Jackson recently gave the world the concept of the gas price “freak-out point” as well as delivering memorable quips on “green car” demand (while calling for higher gas prices), and has been outspoken about the industry’s struggles with “push” production, oversupply, fleet dependence and more. And now he’s laid out what may very well be the basis for a solid “car guy consensus” for political progress on safety issues. Autoobserver reports:

The main points of Jackson’s outline to improve road safety: 1) Make text-messaging illegal – and since that’s unlikely to make much difference, install technology to block text messages in moving vehicles; 2) Raise the gasoline tax to fund safety-enhancing and congestion-reducing traffic-management technology, including intelligent road signals and total automation of toll collection; 3) Get serious about lane discipline by restricting trucks to right-hand lanes and passing only in the left lane.

Can I get an “Amen”? Politics are one of the most divisive issues in American life, and TTAC struggles with the inevitable polarization caused by political topics every day… so hats off to Jackson for solidifying a non-partisan agenda that all (or at least most) car guys can get behind.

Though the auto bailout is being widely defended in the political realm as a jobs-saving measure, the industry sees the rescue’s value in precisely the opposite light, as industry and supplier execs rate “capacity rationalization” as the most positive effect of the bailout. And, reports Automotive News [sub], Ford and GM could still end up cutting as many as six more plants over the next few years as questions linger about volume recovery in the larger market. Of the three GM plants likely to be shut down, the former Saturn plant at Spring Hill, TN, is the most likely to survive as it includes a paint shop, a small engine plant and associated parts manufacturing facilities. In contrast, analysts note that GM’s Janesville, WI, plant is the firm’s oldest and is therefore far less likely to survive, and its Shreveport, LA, compact truck plant is part of “Old GM” and will likely be liquidated. Similarly, Ford’s Ranger plant in Minnesota, as well as its Avon, OH Econoline plant and its Flat Rock, MI Mustang plant could face shutdowns. Ranger is running out of production, Econoline has been losing share to Ford’s more-efficient Transit Connect, and Mustang has been losing market share to Camaro while facing a Mazda pullout from the Flat Rock plant.

Because GM is adding jobs at other plants, the net job loss from its three likely shutdowns (two of which are currently idle) could be relatively low, but then cost savings aren’t likely to match those accrued by past shutdowns either. Ford, meanwhile, is facing a bit more disruption if Mazda pulls out of Flat Rock, but could accrue more savings than GM as only the Ranger plant is scheduled to lose its production. In any case, the UAW will have to weigh its desire to keep plants open with its desire to mitigate the inequity of the two-tier wage system… as well as its desire to gain board seats. All of which could make the UAW’s upcoming bargaining session (not to mention the political debate about the auto bailout) much more interesting…

Tank testing at General Motors’ Milford Proving Grounds

To commemorate Memorial Day here in the US, we’re taking a look at how the American auto industry was mobilized into war production for World War Two. Because that mobilization was so extensive, the conversion to military production so complete, a blog post by it’s very nature cannot really do the subject justice. This is only the most cursory review of the topic, which truly deserves a book length treatment. As a matter of fact, historian Arthur Herman is currently working on a book about the “arsenal of democracy”, American industry during the war.

Herman will have a lot of material to work with.Today we’ll be looking at the role of the Big Three automakers in war production, starting with General Motors. (Read More…)

About two months ago, we heard that Chrysler’s “prototype” Motor Village dealership in the Los Angeles area had been hit with a complaint [PDF] from the California New Car Dealer’s association, arguing that it violated state laws against manufacturer-owned dealerships. The store, a test bed for what Chrysler terms “new retail concepts,” is in fact a partnership between Chrysler and LaBrea ChryslerJeep, making it appear to fit a legal loophole allowing OEM partnerships in retail ventures. But the CNCDA argues that Chrysler is undercharging for rent on the dealership building which it owns, and according to Automotive News [sub], the California Department of Motor Vehicle’s New Motor Vehicle Board just voted unanimously to open a formal investigation into the situation. And the stakes couldn’t be much higher, as AN reports:

If the DMV finds that Chrysler violated state law, the automaker could have its business license in California suspended or revoked.

Ruh-Roh!

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The release of A Road Forward: The Report of the Toyota North American Quality Advisory Panel [PDF], probably raised a few eyebrows around the industry this week, particularly at the headquarters of the Alliance of Automobile Manufacturers in Washington D.C… but not for any obvious reason. The report’s findings about Toyota’s internal reforms in the wake of last year’s recall scandal aren’t particularly mind-bending, and are well summarized in an introductory passage

First, the Panel believes Toyota needs to continue to adjust its balance between global and local control giving weight to local control in order to improve its communication and speed in responding to quality and safety issues. Second, the Panel believes that Toyota needs to ensure that it listens and responds as positively to negative external feedback as it does to negative internal feedback. Third, the Panel believes that Toyota must persist in more clearly distinguishing safety from quality and continue its efforts to enhance its safety practices and procedures.

In addition to identifying specific areas for improvement, the report places a heavy emphasis on “the leadership of Toyota’s top executives as they navigate the road forward, as well as the company’s leadership in the industry” as a way to avoid the traps it fell into prior to the recall scandal. And this emphasis on leadership could have some interesting effects…

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Bertel’s provocative piece on SaabUnited’s complex relationship with Saab and Vladimir Antonov has drawn a predictable response from the Saab faithful, who have rushed to defend their beloved but troubled  brand as well as its mysterious Russian “savior.” The outburst of anger at TTAC, though harsh to the point of almost blaming TTAC for Saab’s sorry state, is nothing new around these parts: TTAC has long angered the die-hard fans of many auto brands by calling for (or simply covering) the demise of brands that have outlived their usefulness to the market. Even the most basic understanding of TTAC’s history explains away the now-popular (in certain corners) theory that this site has a personal vendetta for Saab. On the other hand, perhaps we’ve been too focused on day-to-day developments to properly make the case for why Saab, sadly, needs to die. Luckily the reasons for Saab’s inevitable demise are not difficult to understand…

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The auto media has been receiving its advance copies of Bob Lutz’s forthcoming book “Car Guys versus Bean Counters” over the last few weeks, and have been leaking some of the more provocative statements and conclusions from it. I too requested a book and tore through it over the past week, enjoying Lutz’s direct voice and keen insights into his time at General Motors… as well as the attention-grabbing, politically-charged statements that the rest of the media seems so fixated upon. The bad news is that I won’t be able to write a full review until we get closer to its mid-June launch date, but the good news is that our forbearance has been rewarded: despite sideswiping yours truly in one passage, a brief but rewarding email conversation has generated more mutual respect, and Mr Lutz has agreed (in principle) to a TTAC interview to accompany our review at the time of the book’s release. Sometimes observing an embargo is worth it.

But fear not: just because the promise of an interview with one of the most influential figures in the industry has us delaying our review for another month or so, we’ve got more Lutz-related material with which to build up to what I expect to be a watershed interview for TTAC. Next week I’ll be publishing a review of Mr Maximum’s previous book “Guts,” and to kick of the coming months of Lutzmania, we’ve got a very special contest that is sure to stump even TTAC’s most well-versed Best and Brightest.

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While the political battle lines over increasing CAFE standards are being drawn in Washington, with the industry taking on both environmentalists and itself, a line of analysis that’s been around since 2009 is exacerbating the industry’s internal divisions over the impact of CAFE increases. A two-year-old University of Michigan study has been exhumed and expanded upon in a new CitiGroup report which makes a bold claim: CAFE will actually improve both sales and profits for the industry. And with Detroit taking the lead in resisting CAFE increases, one might think that the industry’s “turncoats” like Toyota and Hyundai, who have made marketing-led decisions to support CAFE increases, would be the main beneficiaries of these reports. Not so. According to this battle-line-confounding analysis, the biggest beneficiary of CAFE increases will be… Detroit. Madness you say? You may well be right…

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