Lost among all the talk about the sparkly "new" GM is the leftover business of the "old" GM. You remember that GM right? The one with all those pesky liabilities, old factories and unwanted brands.
Well, according to testimony by Albert Koch, GM's appointed restructuring chief, winding down the bad GM could cost "slightly in excess of $1.25 billion."
He went on to say that the wind down could take two to three years while CEO Fritz Henderson added that environmental concerns could push the amount even higher.
The General Motors bankruptcy proceedings are wrapping up today and the judge is expected to let this one sail through much like Chyrsler's reorganization. GM will be split into an "old" company saddled with all the problems, and a "new" GM that will emerge with few brands and none of the legacy issues that have plagued the company for decades.
Sounds great right? Well, maybe not. Bill Visnic of AutoObserver breaks down what's left of the "good" GM and doesn't find much to get excited about. Although Chevrolet looks like it can become a strong brand, Buick and GMC are big question marks. Even Cadillac has a tough road ahead gives its limited lineup and dependence on large cars and SUVs. Kind of makes you wonder if this whole government sponsored bankruptcy thing is really doing us any favors.
In a brief statement (138 words), GM North America President, Troy Clarke today announced the end of GM's joint venture with Toyota, the New United Motor Manufacturing Incorporated (NUMMI).
In the statement, Clarke noted that, "GM and Toyota could not reach an agreement on a future product plan that made sense for all parties." Therefore, the 25-year-old NUMMI has been relegated to the dustbin known as "Old GM," and will not be among the assets the company will continue with when it emerges from bankruptcy. GM's participation will end when the last Pontiac Vibe rolls off the line in August.
Clarke ended the statement with, "...we remain open to future opportunities of mutual interest." He most certainly did not end it with, "It was awesome having you in homeroom this year. Stay cool!!!!"
The days of Vibes, Prizms and Novas is officially over.
General Motors recently released some images of Volt prototypes undergoing testing in order to tell everyone that the company is ahead of schedule in testing the range-extended electric car and to keep the publicity pot boiling.
Unlike the Volt mule that we drove, which wore a cobbled-together Chevy Cruze body, these photos show a truly production-intent body. We thought we'd take this opportunity to point out some of the ways in which the production car will differ from the "production concept Volt" the company unveiled at its Centennial Celebration last September and has been trotting out at various auto shows around the world.
It won't be official for another few hours, but the Detroit Free Press is reporting that General Motors has chosen the Orion Township assembly plant to build its upcoming small car.
The Orion Township plant, pictured above at the celebration for the start of Malibu production in 2007, was one of three facilities the General was considering. The others were the former home of Saturn, Spring Hill, Tennessee and the recently closed Janesville, Wisconsin plant.
Orion Township Supervisor Michael Gibb told the Free Press that the Township recently increased its tax abatement offer from 12 to 25 years. Gibb reckons that the abatement could save GM $100 million over 25 years. But keeping the Orion plant up and running, making up to 160,000 small cars a year could save 1,200 jobs in the depressed area.
UPDATE:GM has announced that the Orion Township plant is, indeed, the company's choice to build the upcoming small car. Further, the company annouced that a stamping facility in Pontiac, Michigan will contribute parts to the effort.
General Motors has announced that it will close its Shreveport, Louisiana plant by 2012. The plant currently builds the Chevrolet Colorado/GMC Canyon pickups along with the Hummer H3 SUV which utilizes the same platform.
When a deal was announced to sell Hummer to China's Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd., it appeared as though GM would continue to supply the H3 to the new owners. Now reports out of China are questioning whether the deal will go through as the Chinese government is not thrilled with the idea of a small private company dipping its hand into the production of Hummer-badged vehicles. AutoObserver: GM To Close Louisiana Truck Plant
The US trustee in charge of overseeing the GM bankruptcy has filed a complaint with the bankruptcy court over excessive fees being charged by two outside advisory companies, AlixPartners and Evercore Group, calling them "unreasonably rich."
According to the Financial Times, the trustee estimates that these advisors could pull in as much as $130M in fees by the time the bankruptcy is over. Most notably, both companies would receive "success fees" upon completion of the bankruptcy procedure. Alix would get $13M while Evercore would score $17.9M.
"Neither Alix nor Evercore had any success at finding either a purchaser or funder for [GM]," the trustee said. "In light of all these circumstances, the Alix application clearly exceeds the bounds of reasonableness."
It doesn't open in the U.S. until tomorrow, but Transformers 2: Revenge of the Fallen is already an IMAX hit internationally. The movie grossed $510,000 over the weekend after playing on just 10 screens. Expect to see monster worldwide numbers in the coming weeks.
General Motors held a webchat session this morning with Troy Clarke, President of GM North America. He attempted to address several issues, but as you might expect most of his answers were light on specifics and heavy on generalities and themes.
When one participant asked about Buick, Clarke said he was very confident that they would get the brand right. "I will tell you that you will be pleasantly surprised at the product line up we have for the new Buick. It will go places product wise we haven't gone with Buick before," Clarke said.
When asked about NUMMI, Clarke said GM has no plans to buy Toyota's Hybrid Synergy Drive technology. "We are not in current discussions with Toyota on licensing their synergy drive. I would point out that we are working like crazy on our own hybrid technology. Also, we are really moving fast on the Volt of which you are well aware," Clarke said.
Other participants, many of which were clearly GM employees expressed frustration with the way GM was being handled. Clarke told him that he thought getting government assistance was the company's best chance of turning itself around. The full text is available at GM's Fastlane blog.
According to report in the Financial Times, General Motors could exit bankruptcy almost a month earlier than expected. Although there are as many as 500 objections, most analysts believe that none of them will derail the process.
Much like Chrysler's bankruptcy, GM is expected to form a new company with its "good" assets while the old GM is left to deal with all the crap that led them into bankruptcy in the first place.
The U.S. government will hold roughly 60% of the new GM while debt holders will get 10% and warrants for 15% more. Will any of these changes enable GM to turn its business around? Figure we'll know by the end of 2009 at the latest.
No big shocker here as General Motors is basically going through the formalities of winding down a brand at this point. Today's announcement merely added a date to the demise of the Vibe compact wagon.
Production will end in August of this year at Nummi, the plant shared by GM and Toyota plant in Fremont, Ca. GM says it's still considering the production of other future models in the plant, but has no set plans for now.
In a webchat yesterday with journalists, GM's CEO Fritz Henderson said he's not a fan of badge engineering, the practice of creating new models by simply changing the name and styling of a current vehicle.
Odd then that he sees a bright future for GMC, a division that is made up entirely of badge-engineered Chevrolets. According to Henderson, the upcoming GMC Terrain is an example of badge engineering done right as it's sufficiently differentiated from the Chevrolet Equionox.
Well, Fritz may be right that the Terrain doesn't necessarily look like the Equinox, but that doesn't change the fact that it will still compete against its Chevrolet counterpart. They're both the same size and feature the exact same drivetrains. Sure, not every town has both a Chevrolet and a GMC dealer, but isn't GM supposed to be doing things differently now?
General Motors has confirmed that it has an agreement to see its Saab brand to Swedish specialty car maker Koenigsegg. The deal is expected to conclude in the third quarter of this year and includes a roughly $600M funding commitment from the Swedish government.
Much like the sale of its Saturn brand, GM will continue to build Saab vehicles for several years under contract until the new company can development its own models.
It's a little hard to read, but this is the letter GM sent out to all of its current customers earlier this week. In it, Troy Clarke, head of GM's North American operations, thanks the recipients for their business and promises that GM is here to stay. How reassuring.
He then goes on to explain how GM intends to regain consumer's trust after it's bankruptcy, or "expedited court-supervised process" as Troy so euphemistically calls it. He first reiterates that GM's dealers are open for service. Sure those Hummer, Saab and Saturn stores will be somebody else's problem soon, but for now they're all about the General.
And as far as the cars go, GM is now government backed, so what could go wrong? If that's not enough, a cash-back coupon was also attached that's good on purchases of any new 2009 GM vehicle.
The latest in GM drama takes a turn away from the government (for once) and moves on to the comments of a sassy blogger from the Huffington Post.
Blogger Gerald Sindell (the author of The Genius Machine) wrote this post called "An Open Letter to GM CEO Fritz Henderson," where he commented "Can an organization that has made so much truly ugly stuff suddenly start making great design?" and even called out the design office in Detroit for being "Older white guys wearing suits."
Ed Welburn, global vice president of General Motors Design, said "No, he didn't," and challenged Sindell to a bare-fisted battle in the Octagon.
Actually, he just dared him to take a seat in the Chevy Malibu or Camaro, Cadillac CTS or the Buick LaCrosse before making such wild accusations. What do you think? Would a drive in any of those vehicles change Sindell's mind?
In case you're wondering where all that stimulus money is going, the General Services Administration (GSA) issued a friendly reminder that it's doing its part to spread the wealth.
"On June 1, 2009, the agency ordered 14,105 fuel efficient vehicles for the Federal fleet using $210 million of funds from the American Recovery and Reinvestment Act (ARRA)," according to the press release.
"This brings the total number of fuel efficient vehicles ordered by GSA using ARRA funds to 17,205 at a cost of $287 million."
The breakdown includes:
2,933 Chrysler vehicles for $53 million; 7,924 Ford vehicles for $129 million; and 6,348 General Motors vehicles for $105 million.
Strangely enough there is no mention which vehicles the agency purchased, only that they will be more efficient that the ones they replace. Reassuring isn't it?
According to a recent survey by automotive consultancy AutoPacific, Americans are highly skeptical that the federal government's involvement with Chrysler and GM will help much. When asked if federal control of Chrysler and GM would result in cars they would want to buy, 66% percent of those surveyed disagreed.
Those responding also disagreed that government interference would help create much cleaner cars and trucks (54%). And not surprisingly, a majority thought that both Chrysler and GM should have been allowed to fail.
Given that Chrysler and GM will be depending on these consumers to pull them out of the muck, the next year could be a tougher one that the two companies expect.
Are GM's best days are behind it? We'll see soon enough. In the meantime, why not take a moment to remember some of the company's most sought after vehicles of the past.
Collector car bible Sports Car Market has assembled a slide show featuring the General's Top 10 auction vehicles of all time. Led by the 1953 Futurliner Parade of Progress bus which sold for an astounding $4.3M a few years ago, it's an impressive lineup of cars from top to bottom.
In a recent interview with the Washington Post, former GM Vice Chairman Bob Lutz reiterated his assertion that the demand for green vehicles is still relatively low.
"When you get out into the marketplace, it's probably just 5 percent of the public that desperately wants something environmentally sound and is willing to pay a premium for it," he said in the interview.
Late-night TV hosts continue to take pot-shots at the auto industry, especially at those seeking asylum in Chapter 11.
Friday night David Letterman took an easy swing at GM President and CEO Fritz Henderson ranking his job No. 2 on the Late Show's Top Ten Worst Summer Jobs list, behind Octomom babysitter and Susan Boyle's groomer.
If GM doesn't get it right this time, Fritz himself could wind up coiffing Boyle's frizzy locks.
If Jay's dyno test left you thirsty for more Hennessey HPE550, you're in luck. We have a full test of the first blown 2010 Chevrolet Camaro SS, and its numbers are downright impressive.
562 horses to the meaty Pirelli P Zero Rosso tires, a 12.1-second quarter-mile and a 4.3-second sprint to 60 mph. That cuts nearly half a second off the stock SS's 0-60 time, and almost a full second off of its gallop to 1,320 feet.
Whether it is the whining of the blower's 6 pounds of boost or the Yenko-inspired throwback graphics, the Hennessey HPE550 shows that American muscle is not dead - even with the looming CAFE standards.
Late last week General Motors announced that Penske Automotive Group made a successful bid to purchase Saturn, saving GM's youngest division from being cast aside like yesterday's lunch as GM heads into bankruptcy.
Edmunds' AutoObservertalked with Roger Penske on Friday about his plan to sell GM-made models in Saturn showrooms while also shopping the globe for other vehicles to sell. Penske said he then hopes to convince the offshore manufacturers of those vehicles to build them in the United States.
For now, GM will continue to build the Saturn Vue, Outlook and Aura for Penske to sell through Saturn dealers for at least three years.
"Concurrent with that, we'll go around the world to see what products could be brought into this country," Penske said. "Those foreign-made products will begin filtering into Saturn showrooms in 12-18 months."
GM has officially announced that it intends to sell its Saturn brand to megadealer Roger Penske pending regulatory approval.
"This is the combination of two iconic teams: Saturn and Penske," said Saturn general manager Jill Lajdziak. "GM had the vision to create Saturn and has the desire to see it succeed in the future."
Under the proposed deal, GM would continue to build the Aura, Vue and Outlook under contract for Penske. Rights to the Saturn brand and certain other unspecified assets are part of the deal as well. Financial details were not discussed. The deal is expected to go through by the end of this year.
What's that? You're a power addict and the 426 horsepower with which Chevrolet endowed the 2010 Camaro SS is weaksauce?
Here's your fix. The orange 2010 Camaro SS you see above has been given the full Texas-style treatment, and I'm not talking about barbeque. Hennessey Performance Engineering, headquartered in Sealy, Texas, coerces more power out of more than just Mopars and Mitsubishis these days, and he's turned his attention to Chevy's latest pony car.
It's called the Hennessey HPE550. The centerpiece of the conversion is the breathing enhancement delivered by a Magnuson Roots-style blower and liquid-to-air intercooler. Supplementing the 6 psi generated by the supercharger is a cold-air intake and free-flow exhaust. Owner John Hennessey tells us that the package swells peak power to 562 hp as measured at the flywheel.
Aftermarket horsepower claims are notoriously optimistic, so we did the obvious thing and strapped it to MD Automotive's Dynojet in Westminster, California. The result was anything but weaksauce.
Until today the Chrysler bankruptcy had been proceeding smoothly. The judge had more or less taken the stance that getting the company out of bankruptcy was its best chance for success. Almost any challenge was dismissed, and the president's desire to see Chrysler out in 30 to 60 days looked feasible.
Well today that process hit a bit of a snag as the Court of Appeals for the Second Circuit held up the sale of Chrysler's assets to Fiat until an appeal by several Indiana state pension funds was heard. The funds, which represent various state employees, are arguing that the bankruptcy judge is unfairly favoring unsecured creditors over their secured positions. They also claim that the federal government can't give Chrysler TARP funds because it's not a financial institution.
Unless you have been heavily sedated for the last couple of days, you're already aware that GM officially declared bankruptcy on Monday. Sounds troublesome doesn't it?
Well, it's not really that bad, at least according to a new website GM has created. Called Reinvention, the site focuses on the progress the company intends to make in the coming years. It also answers pertinent questions owners and workers may have like "Is my warranty still good?" or "What's going to happen to my pension?"
There's even a slick new commercial full of montages and corny time lapses. Get ready for a remix of Kanye's Stronger with the new GM new business mindset (leaner, greener, faster, smarter) edited in.
As expected, The Daily Show had a bit of fun with the whole GM bankruptcy story. Stewart wondered aloud how they received $20B and still went under and then moved on to jabs at Mark LeNeve and GM's new website.
Of course, when all the fun was over, Stewart got serious, or at least pretended to be for a moment. He asked why the government thinks it's a good idea to invest in money losing companies instead of cash cows. "Why not buy into McDonald's or Google," he asked.
Seems almost logical, unless of course you happen to be one of the tens of thousands of people across the country who depend on GM for a job.
Compared to last year, May's sales numbers were miserable. Let's face it, when a 19% drop somehow looks good, there's still a problem.
We've come to expect such misery these days, but as AutoObserver points out, there are a few glimmers of hope in May's sales numbers.
- The Seasonally Adjusted Annual Rate (SAAR) is at its highest point of the year at 9.9 million.
- Most sales numbers beat analyst's expectations.
- The stock market is up and car sales typically rise with the markets. Consumer confidence is also up.
Hard to tell if this trend will continue at this point. It could be a result of bargain hunting or a little pent up demand. Either way, it's the kind of news we need at this point given how deep taxpayers are now entrenched in the business.
Nothing new here really. Michael Moore never misses an opportunity to pontificate on the demise of General Motors. Occasionally, he's right (see Roger & Me), but all too often he gets lost in his own hubris, rambling on incoherently in a dreamland that only exists in his head.
Some of that is on display in the latest rant published on this website. He calls for President Obama to convert all of GM's plants into alternative vehicle factories. Then he says we should build a network of bullet trains all over the country, 'cause you know, Japan has them.
He also wants all medium and large cities to have light rail systems, all of which would be built by former auto workers of course. And for those workers who can't find a job building light rail cars, he suggest converting closed plants into manufactureers of solar panels and wind mills.
Oh, and we should begin building more hybrid and electric cars, something that will only take a month or so according to Moore.
After signing off from the Tonight Show last week, Jay Leno figured he would have a weekend of doing nothing but playing with his cars. Which of course made this past weekend no different than any other weekend for Jay. This time, however, he pulled out one of his more interesting and rare toys: the EcoJet, turbine-powered concept.
You might remember the EcoJet concept from the 2006 SEMA show. It uses a 650-horsepower Honeywell turbine for power and runs on biodiesel, lots and lots of biodiesel. Underneath, there's an all-aluminum Corvette Z06 chassis, while the body of the EcoJet is made entirely of carbon fiber and kevlar. In other words, this sucker was expensive.
We'll hand it to Jay though, he said back then that he would drive it on public roads, and yesterday he delivered on that promise. And say what you will about the design, when this thing pulled into the parking lot with its turbine wailing, all the open-piped Cobras on hand suddenly seemed quite tame.
Hard to tell how this whole GM mess will play out at this point, but a story yesterday in the New York Times made us a little less confident that the folks from D.C. will make the right calls.
Turns out the President's Task Force on Autos was largely manned by a single person from November to February. Not a surprise really, as the administration was still getting its head around the situation during its transition period. The hard part to comprehend is the fact that Brian Deese was the guy in charge.
You see, Mr. Deese is a 31-year-old law school student with no previous auto industry experience. According to the article, Deese had never set foot in an auto plant prior to his assignment to the task force. As the group took shape earlier this year, Deese was relied upon to give assessments of Chrysler's and GM's viability as companies and still holds significant sway even today.
Not that Mr. Deese isn't a smart guy, but it seems as though the adminstration could have found a slightly more qualified person to take on such a monumental task, no?
Now that the whole bankruptcy thing is official, General Motors wasted no time laying out its plans for plant closures. It also made it clear that the small car it announced last week is still on the table.
In what may be the most anti-climatic major bankruptcy ever, General Motors officially entered Chapter 11 bankruptcy this morning. From the official statement:
"Pending approvals, the New GM is expected to launch in about 60 to 90 days as a separate and independent company from the current GM ("GM"), with two distinct advantages: it will be built from only GM's best brands and operations, and it will be supported by a stronger balance sheet due to a significantly lower debt burden and operating cost structure than before.
The New GM will incorporate the terms of GM's recent agreements with the United Auto Workers (UAW) and Canadian Auto Workers (CAW) unions and will be led by GM's current management team."
So there you have it, a "new" GM is on the way. Stay tuned for further details.
Well, bondholders do seem to be lining up for the new plan negotiated over the last several days, and the UAW has finally come into line.
But the chances that Fritz Henderson is calling a press conference to announce that GM avoided bankruptcy aren't very good. At least the markets won't be surprised by the news.
Former GM product chief Bob Lutz recently told a gathering of Detroit's automotive press that General Motors will likely emerge from hard times in a much better position to compete. He wouldn't confirm that GM will enter bankruptcy for sure, but he didn't hesitate to give his opinion about what would happen if GM does in fact declare Chapter 11.
"We intend to get in and out very soon," he said. "The U.S. government wants its money back, and our plan is to pay it back as quickly as possible. The U.S. government doesn't want to own auto companies."
General Motors announced this morning that it intends to build a new small car at an undisclosed plant in the U.S. We assume GM is referring to the Chevrolet Spark, but who knows at this point.
Announcing production plans just days before you also announce your own bankruptcy seems like odd timing, but then again, everything coming out of GM seems a little bit odd these days.
When GM engineer Mark Stielow was reassigned from the dying High Performance Vehicle Operations unit to the group that handles the hybrids, he created the coolest, most powerful "hybrid" we've ever seen.
This hybrid of a 1969 Camaro body with the engine, brakes, wheels and tires of a Corvette ZR1, called "Jackass" puts more than 500 horsepower to the rear wheels, through a Viper transmission and a live rear axle. Sounds exactly like something a Jackass could appreciate.
You see GM Engineer Mark Stielow's alter ego is that of a famous Pro-Touring hot-rod builder by the name of Mark Stielow. His series of reworked first-generation Camaros that go and turn and stop have made him something of a hero in the muscle car world.
Jackasses that we are, we might even get a drive in this creamy yellow screamer very soon. The car is seen here very near the end of its 20-month gestation.
General Motors continues its march toward bankruptcy with a new offer for bondholders who laughed/cried at the original offer. The latest plan offers up as much as 10% of the company initially and another 15% down the road.
The federal government would still become the majority shareholder with as much as 72% of the company under its control. The UAW would control the remaining shares.
Unlike the first offer, bondholders now see the new terms as a better alternative that a long, drawn out fight in bankruptcy court. Expect to see some kind of resolution before next Monday's deadline.
When Mark McNabb announced he was leaving GM last week, most assumed he was merely jumping off a sinking ship. No big surprise there really as he had only been at GM for a year or so. Before that he was at Nissan, a job he returned to after a short stint at Mercedes-Benz, so yeah, the guy gets around.
Now he's the new President and CEO of Maserati North America, Inc. With only a handful of models, McNabb's job should be fairly easy after coming from two full-line manufacturers. Then again, selling high-dollar exotics during one of the worst economic recessions in U.S. history could present a few challenges.
It was a surprise to Wall Street, and just about everybody else, when the Conference Board released its Consumer Confidence Index report for May this morning. Now registering 54.9, the index saw its biggest one month increase in six years and highest level since September.
The report sent the market soaring nearly 200 points, but more importantly it also contained news that the number of consumers expecting to buy a car in the next six months rose to its highest level since April 2008. The report also cautioned that home prices continue to decline and unemployment remains high.
That said, might the GM and Chrysler bailouts get done in time to take advantage of an uptick in the economy. Or are they just going to limp along while stronger competitor take advantage?
This is the make-or-break week for General Motors. It either comes up with some miracle plan that satisfies both its bondholders and its workers or it declares bankruptcy. Most of the smart money is on a bankruptcy filing, even before the June 1st deadline.
Not that filing bankruptcy is going to make things much better. As Bill Visnic writes in a piece on AutoObserver, "If GM takes another $7 billion-plus after June 1, government loans - extended through the Treasury Department's Troubled Asset Relief Program (TARP) program - will exceed $28 billion. Add that indebtedness to the nearly $70 billion combined that GM lost in 2007 and 2008 and the company is approaching an astounding $100 billion "loss" in the past two-and-a-half years."
Yes, there is no doubt, things can get worse for GM.
Anyone have any predictions? Liquidation? Move to just two brands? Come out of it stronger than ever?
Say what you will about Chevrolet (and you will), but it has for decades led the industry in production of sometimes-tasteful, often-not special editions of its cars. In this way, Chevy is very much like the Bugatti Veyron, Maybach and Mercedes-McLaren SLR. Otherwise not so much.
This marks the first time Chevrolet won't produce an Indy pace car replica on the years when the Camaro has paced the race ('67, '69, '82, '93).
This may or may not have something to do with the fact that the company will produce an unspecified number of Bumblebee replica Camaros, timed to go on sale when the second Transformers movie opens this summer.
Here's your chance to vote for your favorite special-edition. Will it be the 2010 Bumblee Camaro? The 2010 Indianapolis 500 Pace Car Camaro that won't exist? Or the 1974 Oleg Cassini American Motors Matador?
The Associated Press is reporting that both BMW and General Motors intend to skip this fall's Tokyo auto show. Both companies said they made the decision to save money.
"It is unprecedented to see such a large number of carmakers not coming to the motor show. It's disappointing," said Kazusa Yoshino, a spokeswoman for the Japan Automobile Manufacturers Association, which sponsors the biennial auto event in October.
There are only 4 foreign automakers committed to the 2009 Tokyo Auto Show at this point: Ferrari, Hyundai, Kia and Lotus.
According to a report in the Washington Post, the Obama administration is preparing to send GM into bankruptcy next week. The plan would include an additional injection of capital that could top $30B.
Under the plan, the government would own at least 50% of GM while the UAW would control roughly 39%. The remaining stake would most likely be split by the Canadian government and GM's bondholders.
Those bondholders remain a significant hurdle, however, as they have yet to accept GM's proposed debut-to-equity offer.
Bill Reinert, Toyota's U.S. national manager for advanced technology, told a National Academy of Sciences panel in Washington, D.C., Monday that the success of plug-in hybrids depends on their advantages over traditional hybrids.
"There is a great deal of variation on how current PHEVs perform in real-world conditions," Reinert said.
Although his statements sound like direct shots at cars like the Chevrolet Volt and Fisker Karma, Toyota is also testing plug-in variations of the Prius so he's probably speaking about their own conclusions.
Not sure why GM put out a press release on its Homogeneous Charge Compression Ignition (HCCI) engine program today. There was nothing new to announce and the technology is nowhere near production ready. Can't imagine it has anything to do with looking good for it's new owners.
For those that aren't familar, gasoline-fueled HCCI engines use high pressure to induce ignition much like a diesel. They promise improved mileage along with cleaner emissions. Numerous manufacturers have been working on such engines, but they work much better in a lab than they do out in the real world. In other words, don't expect to see an HCCI on any options list anytime soon.
That old joke about Government Motors? It could become reality within the next couple of weeks according to a Reuters report published today.
The report says that the current bankruptcy plan calls for General Motors to move its "good" assets to a new company owned by the government. The "bad" assets would remain in bankruptcy in order to pay off debts.
In order to give the new company a running start, the government would not only extend a line of credit to the "new" GM, it would also forgive the $15.4B in loans it gave GM over the last few months. Nice huh?
Eventually the company would be handed over to the UAW and GM's bondholders. Fritz Henderson would likely run the new company according to the unnamed source. How this will fix GM's problems is still up for debate. It's still possible that GM could avoid bankruptcy altogether. Maybe.
General Motors hasn't made the list of 1,124 rejected dealers public, but the Huffington Post is keeping track and you can find the working list here. Meanwhile, someone at the New York Times went to the trouble of creating an interactive map for all 789 doomed Chrysler dealers.
In addition, Max Fraad Wolff, a writer for the Huffington Post, has written a dark but compelling column on the GM-Chrysler situation. He refuses to lay the blame solely on the automakers, the union, the large banks, the bondholders (aka "the speculators) or the Obama administration and its automotive taskforce.
Snippet: Chrysler bondholders were offered 29 cents on the dollar with greater offers being made to the UAW employee trust despite its being a lesser creditor in standard Chapter 11 proceedings. Thus, this group had nothing to lose but Obama tongue-lashing if they refused the deal. They did refuse and the tongue-lashing came full of statements about those unwilling to make sacrifice. The political game is to blame another party -- perhaps with good reason -- for the ultimate bankruptcy. Public relations theater has gotten all the attention. We should be looking at the destruction of a region, an industry and the shocking lack of industrial policy.
Snippet: We so completely lack an industrial policy that we are presently working to spend money to maintain our car market while decimating US domestic car producers. Perhaps the goal is to be the first developed country with neither significant American car production nor, public transit?
Whether you agree or not, Wolff's column is well worth the 5 minutes it takes to read.
Is there any reason not to be happy about the arrival of the 2010 Chevrolet Camaro? Possibly, says the Financial Times. The newspaper points out that GM has 12,000 orders in for the 2010 Camaro -- enough to justify adding a Saturday shift at its Oshawa, Ontario, plant.
Yet, the Camaro seems not to be the sort of car that can hold the attention of the President's automotive taskforce.
"The Camaro does not exactly fit the eco-friendly image that politicians in Washington -- who now have effective control of the company -- are pushing GM, Ford Motor and Chrysler to adopt," says FT.
So what do you think? Would it really be better if the 2010 Camaro was some sort of hybrid or electric car, rather than a rear-drive, V8 muscle car? Or does it even matter given GM's rather dire situation?
General Motors has begun notifying 1,124 dealerships that their franchise agreements will probably not be extended past October 2010. Unlike Chrysler, though, GM will not release a list of those dealers, but they'll undoubtedly come out of the woodwork as the day wears on. Bloomberg is already reporting that six Autonation dealerships will be getting letters.
The affected dealerships will be getting further details on how to wind down their business after June 1, Edmunds Auto Observer reported. At that point, of course, GM may have already filed for bankruptcy.
Note that these 1,124 dealers do not include the 470 already scheduled to close when GM drops Hummer, Saab and Saturn. Further, GM would have to shed another 775 dealerships to meet its goal of trimming its dealer base from 5,969 (prior to today's announcement) to 3,600 by the end of 2010.
The format of this interview will be nothing new if you're a Fox News (aka The Yelling Channel) regular, but Fritz Henderson's stoicism in the face of Glenn Beck's bluster is quite the contrast.
Gems from Beck:
On GM's looming bankruptcy: "You're in bed with the federal government. We have cars that are possibly going to be made now by a company run by unions and the government. What kind of nasty K-car are we going to be getting in the future?!"
"The President just fired your predecessor. If that's not running your business, what is?!"
On the Chevrolet Equinox Fuel Cell: "This car is absolutely amazing! I made a time capsule for my children and said, 'This is the car of the future, kids! It runs on water. It's a fuel cell. The only thing they have to get right is the battery!'"
General Motors edged another step closer to bankruptcy in a late Thursday filing with the U.S. Securities and Exchange Commission. In the report, the company formally acknowledged bankruptcy is a likely outcome if cannot resettle its debt and renegotiate its terms with the United Auto Workers by June 1.
You can download the full report below as a PDF, but of course it's a dense tome (439 pages). On page 7, though, GM says that relief "may include (i) seeking bankruptcy court approval for most or substantially all of our assets pursuant to Section 363(b) of the U.S. Bankruptcy Code to a new operating company, and a subsequent liquidation of the remaining assets in the bankruptcy case (a '363(b) sale')."
This is exactly the scenario playing out currently with Chrysler and Fiat. Only in this instance, there's no obvious buyer waiting to scoop up "Good GM" -- other than an entity backed by the U.S. government, says Automotive News. And so the agony goes on.
Soon enough you'll really begin to see the results of the dire situation for both GM and Chrysler. All the major news outlets are reporting this morning that both companies are expecting to cut up to 1,000 dealerships each by Friday. Reuters, though, reports that GM could drop as many as 2,000 dealers this week
For GM, this is part of the planned 2,600 dealers to be cut by the end of 2010. At the end of 2008, it had 6,246 dealers, Automotive News reports.
Cutting 1,000 Chrysler dealerships would consume nearly a third of a network that numbers 3,189. Then again, there's obvious and legitimate concern that Chrysler might soon not have much product to put on dealer lots anyway as it wastes away in bankruptcy court.
After yesterday's pace car clunker fest, we're proud to present some of the 500's more prestigious pace cars. These cars actually did their production namesakes some good, or at least looked great trying.
This year it's the 2010 Chevrolet Camaro SS, a solid, almost inevitable choice. Such decisions haven't always been so clear cut. During much of the 70s and 80s, the choices were slim. But they had to slap stickers on something, so you had some dodgy representatives like the Oldsmobile Calias and Cadillac Eldorado.
So what do you think? Which car deserves the title "Worst Indy Pace Car Ever"?
If you need any more evidence that General Motors is on its way to bankruptcy consider this: Six of GM's top executives, including former Vice Chairman of Production Development Bob Lutz, have cashed out their shares.
They were only worth $1.61 a piece so the suits didn't make out quite as handsomely as they had hoped. Those same shares were worth about $42 a piece less than 18 months ago. No matter how rich you are, that's gotta hurt.
According to CNBC sports business reporter Darren Rovell Nascar driver Dale Earnhardt Jr. is the most marketable sports figure in the world today despite his lack of winning. That's right, the sports number one son has won just twice in his last 110 races, but he keeps signing lucrative endorsement deals.
And the reason is simple. If you sponsor Dale Jr. you sell more product.
Just ask Pepsi. Since the soda giant put its AMP energy drink on Dale's car last year, sales are going at 200 mph.
Rovell says, "Last year, sales of AMP Energy drink grew 127.5 percent in top NASCAR markets. And growth almost hit 100 percent in the grocery channel alone.
This year, with AMP still on Earnhardt's car, the brand saw a 2.6 percent share jump in the first quarter, with volume up over 30 percent.
AMP Energy has jumped from sixth to fourth in the category - only behind Monster, Red Bull and Rockstar.
So despite Earnhardt's lackluster win percentage, Pepsi announced the next step this week. Starting this summer, Amp Energy will have an Earnhardt-themed drink called Tradin' Paint."
Personally we prefer Rowdy Busch. Like Dale's daddy, he actually wins.
That's how bad it is these days for General Motors. The company declared a $6B loss in the first quarter this morning, yet Wall Street was actually expecting an even scarier number. Yes, scarier than losing $6B in three months.
Last week we were alerted to one of the first known breakdowns of the 2010 Chevrolet Camaro. Turns out it may not have been an isolated incident as GM has now issued a recall to realign a battery cable that could cause a short.
According to the recall, it only affects certain Camaros with a V8 engine. Turns out the positive battery cable rubs on the starter housing which could eventually wear the protective insulation away and cause a short. GM is advising owners not to drive their cars and will provide courtesy transportation to the dealership.
GM Vice Chairman Tom Stephens used the company's Fastlane blog to reassure hybrid fans that a plug-in hybrid is still in the works. Originally planned for the Saturn Vue, GM's plug-in system is currently being adapted to another similarly-sized vehicle. Looking at GM's new "core" brands, that means either the Chevrolet Equinox or GMC Terrain.
According to the Wall Street Journal, General Motors is considering the idea of selling its Saturn unit to Renault. The French automaker would use the Saturn dealer network as a launching pad for a new lineup of small, fuel efficient vehicles.
Renault already controls Nissan and Samsung Motors, so Chief Executive Carlos Ghosn may consider the acquisition of Saturn a cheap way to get its European products into the U.S. market.
GM says the 2010 Chevrolet Equinox gets 32mpg during highway driving based on internal tests. It expects official EPA ratings to come out shortly. If the numbers (it also gets 22mpg in the city) prove correct, the Chevrolet Equinox would be the most fuel efficient SUV in its class.
The Wall Street Journal is reporting today that megadealer Roger Penske is one possible buyer for the Saturn brand. Both Penske and GM declined to comment.
There was no speculation in the report about what Penske would do with Saturn, but Penske does sell the Smart ForTwo through a small network of dealers now. Maybe he's looking for a broader distribution network in anticipation of bigger sales numbers down the road.
Update: This is the official statement from Penske regarding Saturn inquires.
"Regarding our involvement with Saturn, we confirm that we have an interest in looking at future opportunities with the Saturn brand. Penske Automotive has not made a proposal to General Motors for this business and the time frame involved is extremely tight.
Penske Automotive buys and sells dealerships as part of our normal operations; we have experience in the distribution business and are constantly looking for opportunities to grow our business and further diversify our overall operations."
It's been in the works for years and now it's on hold - again. We referring to the smaller, light-duty diesel engine planned for the Ford F-150. It was scheduled to go on sale in 2010, but according to a report in Automotive News it's now on indefinite hold.
Adding a high-mileage, high-torque diesel to its most popular truck seemed like a sure thing a year ago. Now that gas prices have come down, however, diesel is far less attractive from a cost standpoint.
According to article, the program has been delayed until 2013 but if gas prices remain low compared to diesel fuel the engine could be scrapped altogether. General Motors recently delayed development of its own light-duty diesel in an effort to conserve cash.
The April sales numbers are in and although the market hasn't exactly turned a corner just yet, there are signs that the slump may be leveling off a bit.
The overall sales rate, menacingly referred to as SAAR (Seasonally Adjusted Annualized Rate), was down to 9.5 million from 9.8 million last month, but still not as bad as February when it was as low as 9.1 million.
General Motors was down compared to last year's April sales numbers, but up 14% compared to March. It market share was also up. Ford also fell compared to last April but was up 8.3% compared to March. Toyota had a tough month with sales down 42% compared to last April.
For a complete analysis of all the numbers, check out AutoObserver's take on this month's sales numbers.
Maybe you haven't heard of Jim Wangers, but he was the marketing force behind the Pontiac brand in the 1960s and '70s -- back when Pontiac was cool -- and is credited with the wild success of the original GTO.
A couple days after GM killed Pontiac, David Zenlea, an editor at Automobile, interviewed Wangers, now 83 and retired, but still active in the Pontiac owners community. Not surprisingly, he had more interesting things to say than just about anyone else who has been pressed for funeral soundbytes. It's a short interview and well worth the 2 minutes it takes to read (yes, even if you're put off by the blazer he's wearing in this famous photo).
Snippet: "One of the worst things that happened was when they came out with the new GTO. It was so badly handled, packaged, and marketed. They changed so many things, they failed to jump on what it really meant to be a GTO...
"Then they had the crazy idea of changing the names.
"If there was ever a domestic manufacturer that ever had a really good set of names it was Pontiac - Bonneville, Grand Prix, Trans Am! And then all these little boys in men's jobs come along, and come up with insanely stupid 'G' names."
There have been cop Camaros since the late 1970s. The ponycars second, third and fourth generations all made it into the hands of the man (some photos after the jump) and chances are the new 2010 Camaro will do the same. This video shows the best rendition of a 2010 Cop Camaro we've seen. The guy got it right, down to the push bar and extra lights.
It's now official. President Obama announced this morning that Chrysler has entered into bankruptcy proceedings.
His remarks revealed little in the way of new information, but Obama did go out of his way to call out the private equity groups that stood in the way of a reorganization out of bankruptcy. "I don't stand with them," he said.
Obama went on to say that the bankruptcy "will be quick and efficient," a promise that will be tough to deliver. He also suggested that Americans who are in the market for a new car should "buy American."
Also worthy of note, GMAC (formerly known as the General Motors Acceptance Corporation) will take over the retail financing of Chrysler vehicles.
After talks with creditors collapsed last night, a Chrysler bankruptcy appears all but certain by the end of the day. Although much of Chrysler's debt had been renegotiated, several private investment firms still hadn't agreed to a deal.
Most reports say that the government is hoping for what is being called a "surgical" or "quick rinse" bankruptcy. There's only one problem with that idea: there's no such thing.
At least that's the opinion of the prominent Michigan law firm of Plunkett Cooney. It held a conference call two weeks ago to discuss GM's possible bankruptcy. Among other things, it said the government made up the term "quick rinse" as it's not a term bankruptcy courts have ever used.
It also cited several recent examples of large companies that went into bankruptcy court and none of them could be considered "quick" or "surgical". The closest thing to it was Mrs. Fields cookies which declared bankruptcy last August. It took 7 months to resolve that one.
Check this out. Avis will rent you a 2010 Chevy Camaro. One that seats 4, has air conditioning and the rare luxury of power steering. Automatic transmission too of course, as Avis has no interest in frequent clutch replacements.
Watch any of the taking head channels and the guys they get to analyze the auto industry never seem to know anything about cars. It's like Fox, MSNBC and CNN just call 1-800-MBA GEEK and some pinhead that doesn't know front-wheel drive from rear is in the studio ready to tell the world what went wrong at Pontiac.
Well, not this time. This time the gang at Fox Business interviewed Darwin Holmstrom the co-author of the new book GTO: Pontiac's Great One. The topic of course was the demise of the 83 year old division of General Motors and Mr. Holmstrom obviously understands that America has lost one of its great brands. And it's sad.
Jay Leno has written a monthly column in Popular Mechanics magazine for 10 years, and we haven't missed a single one. Topics have ranged from Duesenbergs to the ZR1 and Jay's personal Green Garage, which includes solar power and a PacWind Delta II vertical-axis wind turbine just like the one that powers Edmunds HQ.
But Jay's latest manifesto, which appears in the May issue of PM and on www.popularmechanics.com is a little tough to get through. Jay decided to predict furture collectible and classic cars. Which is fine. But he must have been drunk when he started pecking the keyboard.
Camaro5 member BUMLEB was stranded on Sunday when her yellow 2010 Chevy Camaro 2SS automatic conked out without warning. She had just bought the car and had driven it for only 20 minutes before needing her AAA card and a big white flatbed.
Now that Pontiac is officially dead, it's easy to pick at its bones and catalog everything that went wrong -- from "A" for Aztek to "P" for Parisienne and "S" for Sunfire. But Pontiac is where the muscle car was invented and it was where it came closest to being perfected.
Discounting race-only specials like the radically lightened "Swiss cheese" 1963 Catalina and 1963 Super Duty Tempests, here are the 10 greatest Pontiac muscle cars of all time. Pontiac itself will go away, but these 10 cars will be impossible to forget.
The death of Pontiac has inevitable repercussions in Australia, since, barring the Pontiac G8's reincarnation as a Chevrolet, exports to the U.S. would stop before the end of 2009. That amounts to nearly $1 billion (Australian), or about $700 million (U.S.), Australia's drive.com.au reports.
You can read what Australians have to say about the future of Holden on Drive's blog. Although the very first commentor suggests the Commodore could easily wear a Chevrolet SS badge, successive commentors are far less optimistic and proceed to lay into Holden for its quality record in the home market. The tone is all very familiar.
In this morning's press conference, GM CEO Fritz Henderson said that the company doesn't anticipate building any Hummer or Saturn vehicles beyond 2009.
Sounds dire, but the situation could change in either case if new owners decide they want to contract with GM for additional production. Saturn in particular has said it will try to restart itself as an independent company and contract with GM to build the current lineup until it completes its lifecyle in two or three years.
Future owners of the Hummer brand could theoretically do the same, especially given the fact that the current Hummer models are based on GM truck platforms that aren't expected to change much in the next several years.
Now that GM has made it official, it's time to cue the memorials. Always best to remember the good ol' days at times like this, so we'll ask the inevitable: Which Pontiac was your all-time favorite?
Last Thursday, Inside Line broke this story and now General Motors has confirmed it. Pontiac will be phased out by the end of next year in an effort to further consolidate GM's brands.
Other details of the plan include:
- A 42% reduction in the number of dealers - from the current 6,246 to 3605 by the end of 2010.
- A 28% reduction in the number plants - from 47 to 34 by the end of next year
- A 34% reduction in the number of hourly employees - from 61,00 to 40,000.
- A 34% reduction in labor costs - from $7.6 Billion to $5 Billion by the end of 2010.
GM has announced that it will hold a press conference to discuss details of its revised plan for reorganization. CEO Fritz Henderson will host the roughly hour long press conference that will be webcast if you care to watch.
What would happen if a tape-and-name special edition turned out to be something genuinely interesting and not just another shameless grab at the wallets of the Corvette faithful? Would we not make fun of it?
The answer is, "Yes, we would not make fun of it." Thankfully, such is the case with the 2010 Chevrolet Corvette Grand Sport. While the production Grand Sport isn't exactly the wicked racer that in the way the original '60s. But neither is it just a couple of piece of tape on the fender.
The folks that brought you the GTO (but also the Aztek) and the Firebird (but also the Trans Sport) appear to be one step closer to the gallows.
If rumors around GM's RenCen headquarters are true, the troubled corporation will announce the discontinuation of the Pontiac brand next Monday as part of the deeper-cutting reorganization demanded by the Obama administration's auto task force.
GM said, as early as late last year that the division would become a "niche brand," outside of the four core brands GM wanted to protect (Chevrolet, GMC, Cadillac and Buick). The company, however, never defined exactly what sort of niche it was talking about. Was that a niche that included the G3, a Chevy Aveo re-badge? Or was that a niche that included the G8 rear-drive sports sedan?
It seems Pontiac's fate might have been sealed by a combination of increasingly tough demands for cuts from the Feds and Pontiac's utter lack of focus over the past few decades.
General Motors, in the person of News Relations PR man Tom Wilkinson neither confirmed nor denied nor, well, here's what he said: "There's nothing I can share with you at this point. Keep your eye on our media site. Officially nothing has changed with Pontiac's niche-brand status, until you hear differently."
With inventories of new cars and trucks swelling to unprecedented levels, General Motors may idle many, if not all, of its plants this summer for up to 9 weeks. Typically, GM closes its plants for two weeks in the summer to switch over to the next model year.
In a rousing Earth Day memo, GM Vice President of Environment, Energy and Safety, Beth Lowry, sought to reassure outsiders that GM is still committed to its environmental initiatives despite having little money to pay for them.
"I want to assure everyone that despite the current economic challenges and the fact that we are undergoing great changes to reinvent the company, resources for 'green' initiatives are being preserved," Lowry wrote.
Strangely absent was a progress report on the Chevrolet Volt although GM has said numerous times in the past that it was safe from the current cost cutting measures.
It's been the big dog on the auto show circuit for awhile now, but some behind-the-scenes political fighting threatens to derail the Detroit Auto Show altogether. Daniel Howes details the issues in his latest column for the Detroit News and it's not pretty.
It begs the question: Does anybody still care? With so much bad blood surrounding the Big Three and their respective financial issues, is Detroit still enough of a draw to lure the world's major manufacturers to a show in Michigan in the dead of winter?
After Bloomberg broke a story this morning suggesting that GM would rid itself of both GMC and Pontiac to avoid bankruptcy, the General's PR team went into full react mode. The result is a follow up piece by Automotive News that refutes Bloomberg's anonymously-sourced report.
Sales chief Mark LeNeve told the industry trade paper that reports that,"GMC is going away are just unfounded, unsubstantiated and untrue."
He went on to say that GMC is profitable and General Motors is working on plans to make it even more profitable in the future. He also refuted the rumor that dealer franchise agreements would be terminated to accelerate dealership consolidation.
According to a report by Bloomberg this morning, General Motors may drop GMC and Pontiac in a bid to shed more weight in its latest restructuring plan. Bloomberg cites unnamed sources in the report who also say that GMC has a slightly better chance of surviving than Pontiac. There is no mention of what might happen to either brand if GM does in fact decide to cut them loose.
The Wall Street Journal reported today that an investor group is talking to GM about buying Saturn. The plan would include selling GM products initially and then importing "smaller, fuel-efficient vehicles" from a range of companies.
In a statement, group spokesman John S. Pappanastos said, "GM will be relieved of liabilities related to retailer franchise agreements and avoid the downstream financial fallout on their other brands that would result from closing Saturn retail facilities."
Obviously, all of General Motors is pretty much up in the air right now, but Pontiac dealers are feeling especially nervous given the "niche" brand label they acquired in GM's original viability plan. Not much has changed in the last few months and now we know why.
Susan Docherty, vice president of Buick-Pontiac-GMC told Automotive News, "The Pontiac decision is pretty low on the priority list for right now...it's not going to be the savior for GM."
Pontiac dealers probably didn't have any grand illusions that they were going to be a big part of the turnaround, but when the executive in charge tells the press that you're low on the priority list that's got to hurt.
According to Sports Car Market, the National Highway Transportation and Safety Administration (NHTSA) has called for a halt to sales of the cars from the GM Heritage Collection during the Barrett-Jackson auction in Palm Beach, Florida.
The issue revolves around the possibility that the new owners might attempt to register the cars for street use. Both Barrett-Jackson and General Motors have been upfront with bidders that many of the cars are sold with salvage titles and cannot be registered for normal use. Both parties are attempting to resolve the matter although the report says that NHTSA has been unresponsive to further discussion.
Cadillac officials acknowledged today that the SRX crossover, which will arrive in U.S. dealerships in early August, will eventually be fitted with the two-mode electric hybrid system.
It would be the same basic arrangement of parts as used in the full-size pickup trucks and SUVs for the last couple of years. General Motors' plan initially called for the Saturn Vue to be the first mid size crossover withing the corporation to receive a version of that system. Ooooh...yeah, that situation is very much in flux, as they say. Saturn said that it expected the Vue two-mode to be able to do 0-60 mph in 7.3 seconds and return 27 mpg in the city and 30 on the highway with its combination direct-injection V6 and twin 55-kilowatt electric motors. It's fair to assume the Cadillac would perform similarly. For comparison, Cadillac estimates that a conventional front-wheel-drive SRX powered by the 3.0-liter direct-injection V6 should return 18/25 mpg, city/highway.
No word on timing for the two-mode SRX but we wouldn't expect it before the 2011 model year. A few main competitors either already offer a hybrid crossover in roughly the same size and price class (Lexus) or plan to within the next couple of years (Audi, Mercedes-Benz and Volkswagen).
#NYIAS General Motors and Segway are set to announce in a few hours their collaboration on a two-seat, two-wheel electric mobility pod called Project P.U.M.A.
It's called the P.U.M.A. because that stands for Personal Urban Mobility and Accessibility and also because that's a cool name. And by putting "Project" with it GM makes it sound roughly as significant as the Manhattan Project. Incidentally, Manhattan (and the Manhattans of the third world) is just the kind of place GM and Segway see something like this pod making sense.
Of course, Toyota and Suzuki have shown their own electro-nubbins over the years and haven't gotten far with the projects. You might also think of the GM/Segway as half of a GEM Peapod neighborhood electric vehicle or a Nissan Pivo (but without all the smoldering sex appeal or the robotic buddy).
The two companies are only 18 months into the project and the vehicle doesn't even have body work yet. We've included an illustration on one proposed body. Anyway, the companies see the P.U.M.A. or whatever it ends up being called (if anything at all) as a low environmental impact way to relieve some of the congestion of the increasingly crowded cities of the future.
If you slept through this Sunday's Meet the Press interview with General Motors new CEO Fritz Henderson, you didn't miss much. Mr. Henderson dodged host David Gregory's questions like a seasoned pro.
There was one question, however, that he couldn't avoid answering. Gregory asked Henderson point blank why he didn't agree to work for $1 like his predecessor Rick Wagoner. Henderson said he already took a 30% pay cut and that was where his salary would stay. Gregory then put the spurs to Henderson by asking him what his remaining salary amounts to, and not surprisingly Henderson didn't look too comfortable saying the number out loud.
This shouldn't come as a surprise to anybody who has ever seen Roger & Me, Michael Moore's scathing profile of General Motors in 1990s. Mr. Moore didn't see much to like at the top of GM's management hierarchy then, and not much has changed in the meantime.
Moore wrote on this website, "I simply can't believe it. This stunning, unprecedented action has left me speechless for the past two days. I keep saying, "Did Obama really fire the chairman of General Motors? The wealthiest and most powerful corporation of the 20th century? Can he do that? Really? Well, damn! What else can he do?!"
He finished with, "I await the President's next superhero move."
Notice the funky license plates? Yes, the 2011 Chevrolet Cruze is GM's new world car. It goes on sale in Europe any day now and it will eventually make it to the U.S. sometime next year.
Contributor Matt Davis calls it one of GM's most important cars ever given how many markets it's expected to compete in. He thinks it has what it takes to compete, and if the price is right the Chevrolet Cruze could finally become a small car that works for General Motors. Clearly, it could use the help.
The Mercedes-Benz ML-Class-lookin' 2010 Chevrolet Equinox will go on sale in June for $23,185, including $745 destination fee.
That'll get you a front-wheel-drive, four-cylinder LS model. Chevrolet notes that price is $1,800 less than the base-level 2009 Equinox. By our math the 2010 model is $1,825 less expensive than an '09, but who's counting? The significance of this move is that it highlights the fact that at $25,010 the '09 was overpriced compared to its American and Asian competitors (all of which start between $21,000 and $23,500).
You might point out, as Chevrolet did not, that the base level 2010 Equinox is powered by a four-cylinder and the base level 2009 Equinox had a V6. But the new direct-injection 2.4-liter four makes about 182 horsepower. The old 3.4-liter V6 ground out a whopping 184 hp. So it's not as much a downgrade as it might seem on the surface. Plus, Chevy would very much like you to know that it anticipates the four-cylinder model will get 30 mpg on the highway (the old V6 got 24 mpg highway).
Chevrolet hasn't released pricing for 2010 Equinox models powered by the new 3.0-liter direct-injection V6 or any other optional equipment, for that matter. The Equinox will be joined in show rooms soon by a mechanical twin in the GMC Terrain, which is to be introduced next week at the New York Auto Show.
In a move to reassure potential car buyers (and also to copy a successful program from Hyundai), Ford Motor Company and General Motors Corporation both announced today buyer protection plans. Let's have a look at how the three programs compare after the jump.
Well, that's a relief. If there's one thing that could plunge GM deeper into muck it would be government control. Then again, it seems as though Obama and friends are already at the helm. They already pushed CEO Rick Wagoner aside, and today President Obama announced the appointment of Ed Montgomery as Director of Recovery for Auto Workers and Communities. Who knows what kind of power he'll have.
Others items of note in the President's speech this morning:
- Warranties by GM and Chrysler will be backed by the federal government. - Government fleet purchases of automobiles will be accelerated. - The IRS will mount a campaign to inform consumers of a possible tax break when buying a new car. - The President will consider using recovery funds to pay for a "cash for clunkers" program that offers cash to consumers who trade in an older car for a new, more efficient model.
From the unintentionally hilarious headline department comes this (presumably) unintentionally cruel line from the March 30, 2009 edition of trade journal Automotive News.
Although nothing is official yet, various news sources are reporting that the Obama administration has asked Rick Wagoner to step down as CEO of General Motors. The news comes just a day before the President is expected to unveil his latest plan for restructuring the auto industry.
A report in the Detroit News says that the administration plans to give GM 60 days to revise its turnaround plant while Chrysler will get 30 days to finalize its proposed deal with Fiat.
UPDATE: Rick Wagoner has released an official statement on his resignation. Fritz Henderson will take over as interim CEO.
Inside Line tests hundreds of vehicles a year, but not every one gets a full write-up. The numbers still tell a story, though, so we're introducing a new feature on Straightline called "IL Track Tested." It's a quick rundown of all the data we collected at the track, along with comments direct from the test drivers. Enjoy.
Everyone has had their eyes on the 2010 Chevy Camaro SS, including us. It is, after all, the Camaro with a V8. This makes the SS the Camaro for enthusiast. And with a 6-speed manual, the SS will stomp through the quarter-mile in a stunning 13 seconds flat at 110.9 mph.
Also new for 2010, is the Camaro V6, known as the LS, 1LT or 2LT, depending on how much equipment you want on your coupe. All versions use the direct-injection V6 3.6-liter V6 that powers upmarket Cadillac CTSs. And if you order the manual, you get a the same Aisin-built 6-speed gearbox as the Caddy too. That's a good starting point for a car that is supposed to sway those that aren't already initiated into the Camaro faithful.
This car stomps the V6 American pony-car competition. What? You think a 210-hp 4.0liter V6 Mustang will have an answer for the Camaro V6? You think the Dodge Challenger SE with its 250-hp V6 bolted to a 4-speed automatic is going to do anything but embarrass itself? Stop being ridiculous.
No, to get a car that gives the V6 Camaro a run for its (relatively little) money you have to go to Korea, of course. Here we speak of the 2010 Hyundai Coupe 3.8 Track. We've track tested both and we think you'll find the numbers and specifications after the jump quite surprising.
For reasons of personal safety and also convenience we cannot tell you where we shot these spy photos, which was at GM's Milford Proving Grounds two days ago at about 9:17 am.
Anyway, our crack shooters got two clean shots of GM's answer to the Aptera 2e two-seat, three-wheel electric vehicle.
Unlike the Aptera, the GM vehicle, known by its codename "Monte Rickshaw," uses one small front wheel which is connected to the passenger cabin/trunk by a long tube. GM is known to have been researching what's known as Chevrolet Advanced Caster Application, or CACA, which allows the front wheel to spin a full 360 degrees and chatter annoyingly in grocery-store parking lots.
The tube is assumed to be packed, flashlight-style with alkaline batteries or, possibly, magic. Steering is thought to be by something called "helper monkey."
Our sources indicate that: A. The vehicle will arrive in dealerships with the throwback Monte Carlo Style rear seen here with the up-to-the-minute matte black paint job. Or, B. Could this be the next Corvette?!
According to an Associated Press report, General Motors CFO Ray Young told the Obama administration that GM could do without this month's $2B loan installment.
"It seems like our companywide cost reduction efforts are moving well, as well as we've been able to defer spending that we previously anticipated in January and February," Young said. "I think that's a positive development."
Young did not say whether or not GM would reduce the total amount of its loan request, nor did specify whether or not GM would need the $2.6B loan installment due in April.
GM is looking to conserve cash any way it can, so programs that might not be considered "core" projects are getting pushed aside. The latest casualty is the 4.5-liter Duramax V8, a light-duty diesel engine that was originally scheduled to become an option in the 2010 Chevrolet Silverado and GMC Sierra trucks.
According to Automotive News, the program has been put on hold indefinitely. "We have to make tough decisions right now," said GM Powertrain spokeswoman Susan Garavaglia.
The innovative engine design was hailed as a breakthrough when it was unveiled last year. "By using integral cylinder head exhaust manifolds, integral cam cover intake manifolds and a narrow cylinder block, designers saved space and reduced the engine's weight," said Gary Arvan, chief engineer for the 4.5-liter V8 diesel at the engine's introduction.
Key members of the Presidential Task Force on Autos will be visiting Detroit today. On the agenda: driving the Volt and visiting a Dodge plant that builds Ram trucks.
Why? Because spending 15 minutes behind the wheel of an early prototype and talking to three autoworkers will give you all the insight you need to fix a multi-billion dollar global industry, that's why.
Or maybe the task force members are just trying to give it the old college try before they announce measures that could kill both the Volt and Ram truck production.
We don't envy the task force members one bit. A recent poll says just 32% of Americans have a favorable opinion of General Motors. Chrysler didn't fare much better with a 33% favorability rating.
With such meager support, is there anything the task force can do that won't be met with opposition?
Seems hard to believe that any company would be interested in buying a failing automaker given the current market conditions. Yet, in one news story after another, company officials from GM and others claim to have willing bidders for their in-market brands.
AutoObserver columnist Bill Visnic has compiled a list of these claims, and taken together they're no more convincing that they are by themselves. You buying any of it?
The 2009 Geneva Auto Show occupied most of our time this week, so when the February sales numbers came out on Tuesday we overlooked the bad news.
And bad it was, with almost all major automakers reporting double-digit drops in year-over-year sales. And it wasn't just the domestics either, as Honda, Nissan and Toyota all crashed by more than 37%.
Clearly, it's going to take more than just bailout money to get the auto industry going. Without foot traffic, no car company will be able to sustain its current operations. Any suggestions?
The health of General Motors is not improving according to a report submitted to the SEC this morning. Auditors of the company said there is "substantial doubt" that the company can continue outside bankruptcy if it fails to end losses and its cash burn.
"Our future is dependent on our ability to execute our viability plan," GM said in its annual report. "If we fail to do so for any reason, we would not be able to continue as a going concern and could potentially be forced to seek relief through a filing under the U.S. bankruptcy code."
We've got some serious number crunchers around here at the Edmunds corporate megaplex. So serious, in fact, that they don't even have to wait until the end of the month to call the sales numbers.
And their predictions for February? Not surprising, yet still slightly shocking.
How about Chrysler down 53.1% year over year? And Ford? Down 47.5%, GM off 46.2%.
A Big Three problem? Not really.
Try Toyota down 38.9% while Nissan is expected to drop 32.9%. Even Honda could be off 32.1%.
Then again, these are only predictions. It could be worse.
Earlier this week we highlighted a column by Thomas Friedman that ran in the New York Times over the weekend. In it, Mr. Friedman proposed giving federal bailout money to start ups and inventors instead of companies like General Motors, which he called a "wealth destruction machine."
Well, not surprisingly, GM doesn't agree. On its FastLane blog today, spokesperson Tom Wilkinson fired back in a post called "Two Toms, Two Utopias". He likens Mr. Friedman to Thomas More, the 16th century author of the book Utopia.
With that in mind, Wilkinson wrote, "For centuries, Utopians have dreamed of letting the old world burn and building a fresh new world just over the horizon. In the case of the auto industry, which holds a key to solving the global energy puzzle, such dreams are a dangerous diversion from the hard work at hand."
If it were only true. Instead I hear Hollywood's braintrust is working on another Harry Potter. And there isn't a single Trans Am in the entire movie. Sad.
From the department of No News is Good News comes this non-news: The Chevrolet Corvette, that totem of American performance, is safe from the corporate restructuring and Federal Government-appeasing sweeping through GM these days.
While, General Motors announced the disbanding of its High Performance Vehicle Operations unit last week, Corvettes were never subject to that group's ministrations -- not even the Z06 or ZR1 versions. Still, 600-plus horsepower two-seaters are probably not high on Washington's list of favored projects.
"Any speculation about the Corvette going away or being curtailed is unfounded," says Chevy PR boss Terry Rhadigan. "There's nothing to worry about with regard to Corvette."
It's going to take some really ugly business to make GM give up on one of its crown jewels and let's not go there just yet. This does not mean that we'll see the next-generation car, the C7, anytime soon and it does not mean that we'll necessarily get a 638-hp version of that car, but...
Thomas Friedman has won three Pulitzers and has a steady job writing columns for the New York Times. Clearly, he is no intellectual lightweight, but his columns don't always support that notion.
His most recent work is typical in its praise of green energy and condemnation of GM. In Friedman's eyes, GM is a loser that doesn't deserve our tax dollars. Instead we should be handing that money to startups in the green energy space.
"I've been traveling all across the country on a book tour, and every evening I return to my hotel with my pockets full of business cards from inventors in clean energy. Our country is still bursting with innovators looking for capital. So, let's make sure all the losers clamoring for help don't drown out the potential winners who could lift us out of this," Friedman wrote.
Well, that may be true, but Mr. Friedman should not forget there are also hundreds of like-minded folks who work for GM and Chrysler and Ford. Leave those companies to die and we'll be stifling the very innovation that Friedman finds so invigorating.
Green energy is promising and all, but in the meantime we still need cars. And not $100,000 electric cars, real cars, that real people can afford and use everyday. You know, the kind the Big Three make.
There are plenty of interesting details buried within GM's latest rescue plan, but one in particular caught our eye. In the "product plan" section, it states:
Planned Chevrolet Volt and two additional models sharing Volt's extended range vehicle technology
Now we know that GM plans to roll out the Opel Ampera at the 2009 Geneva Auto Show next week, but the third vehicle is a little tougher to pin down.
Saab, the fair-haired stepchild of General Motors and the brand "Born from Debts," has filed for protection from its creditors in a Swedish court, according to TheNew York Times.
The move comes as no surprise because in its filing with the U.S. Treasury Department earlier this week General Motors indicated it would stop funding Saab next year. As is the way these dark days, Saab is looking to the Swedish government to step in and provide financial assistance for the soon-to-be orphan brand.
Uh oh. Reuters news service quoted a spokesman for the industry minister, Hakan Lind saying, "Support in the form of money is not on the agenda."
According to Saab managing director, Jan-Ake Jonsson, the company sees a formal reorganization as, "the best way to create a truly independent entity that that is ready for investment." Indeed. So, anyone interested in buying Saab? It sold a grand total of 21,383 vehicles in the United States in 2008. Gather your crowns, kids.
Yesterday's news that GM will suspend all work at its High Performance Vehicle Operations will not threaten current performance vehicles or the upcoming 2010 Camaro SS.
"Camaro SS, Corvette ZR1 and Corvette Z06 are all regularly engineered cars," spokesperson Vince Muniga explained. "They did not go through HPVO. Most people did not realize that. They are safe."
More importantly, Muniga said that HPVO is on hiatus, not shutdown completely.
"Ford SVT did the same thing a few years ago and they are back," he said, holding out the prospect that HPVO may be revived at some point. "This is an indefinite hiatus."
At GM's press conference Tuesday, CEO Rick Wagoner said that without additional money from the Swedish government, Saab would likely have to file for reorganization. Well, according to various reports, the Swedish government has said it won't help out.
Sweden's Industry Minister Maud Olofsson was quoted as saying:
"I'm deeply disappointed in General Motors. They have in practice removed their hand from Saab. Instead they are handing over responsibility to Swedish taxpayers."
The next shoe has dropped at General Motors and it has landed squarely on performance-car enthusiasts. Just when things were getting really tasty, GM has disbanded the High Performance Vehicle Operations unit of the company's Performance Division.
That's the group, headed by the recently retired John Heinricy, responsible for making low-volume, high-performance versions of GM cars. The group's recent hits include the surprisingly good Cobalt SS and HHR SS and some true ass-kickers such as the CTS-V. According to a report in the trade journal Automotive News, the group was quashed because of some sort of financial issues that General Motors has apparently been dealing with recently. Don't know if you've heard anything about that.
AN quotes PR man Vince Muniga saying, "All high-performance projects are on indefinite hold." Muniga says the High Performance engineers have been moved on to other core product teams.
If there's one benefit to the woeful situation at Chrysler and General Motors, it's that both companies feel the need to reveal at least a little about their future products to convince the government of their viability.
Unlike the bad photochops Chrysler attached to its viability plan, General Motors revealed what appears to be an unadulterated photograph of the CTS Coupe, which will apparently not fall under the cost-cutting knife and is expected to make an appearance in mid 2010.
Of course, GM's willingness to show the production car might have something to do with the fact that it looks almost identical to the concept car (pictured below), except for wheels and a couple of other small exterior details.
In a press conference to explain GM's plan for profitability, CEO Rick Wagoner said that without outside investment, Saturn would be phased out in 2011.
Saturn's dealers have a different plan. In a story in the Wall Street Journal, Dan Januska, a member of the Saturn Dealer Council, said they were considering a plan that would spin Saturn dealers off from GM.
In that plan, Saturn dealers would continue to buy vehicles from GM until the current product lifecycles run out. After that, the dealers would consider buying vehicles from third parties and rebadge them as Saturns. "There are not a whole lot of alternatives," said Mr. Januska, who is on the Saturn Dealer Council. "Someone is going to see the value of us and I don't know who it will be."
With new plans for profitability due today, all eyes are on General Motors and Chrysler. Both companies spent much of the weekend bargaining with the UAW in hopes of winning additional concessions that would help further reduce labor costs.
One potential stumbling block that neither company will have to contend with is a so called "car czar". President Obama changed his mind and will instead appoint a Presidential Task Force on Autos to oversee the restructurings.
According to a report in the Detroit News, White House Press Secretary Robert Gibbs said that the Obama Administration wants "a strong, vibrant auto industry as the basis for our manufacturing in this country is extremely important. We have to ensure that the cars of tomorrow are built here by Americans, for Americanism" Gibbs said.
Nothing like a little Americanism to get the economy back on track.
Actually, this photo was from an earlier time, back when Saturn was running its "Kiss My Astra" contest to promote its new hatchback.
Well, the Astra never did very well and according to a report in Automotive News, current product chairman Bob Lutz said it's not likely to survive.
"We spent a huge bundle of money in giving Saturn an absolutely no-excuses product lineup, top to bottom. They had a better and fresher lineup than any GM division, and the sales just never materialized. So we have to act on that. It's our duty," Lutz said.
GM has until tomorrow to present a plan for economic viability to the federal government. Automotive News
A 10.9-second quarter-mile at 132.2 mph, to be exact.
Hennessey calls his breathed-on 2009 Corvette ZR1 a ZR700, and did the deed on stock Michelin street tires.
The ZR700 wears a host of bolt-ons and a reflash to swell output to 705-hp and 717 lb-ft, which apparently is enough extra sauce to beat the stock ZR1 we recently tested by 0.6-second and 3.9 mph.
As an aside, how badass are the ZR700's blacked-out wheels? A night and day improvement over the gaudy chrome on the stock ones, we say. Click the thumbnails below for a full-size version:
This video is slight less exciting than watching a paperweight, but it is a pretty good walkaround of the new Chevy Spark through the eyes of its designer. Personally, I'd rather watch a wall, but that's just me. Enjoy.
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