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.
Suzuki will expand its SX4 lineup with the addition of a Sportback model this fall. It's essentially a performance-oriented version of the current SX4 hatchback. It will feature a new 2.0-liter engine that bumps output to 150-hp and 140 pound-feet of torque.
Power will go to the front wheels through either a six-speed manual or Continuously Variable Transmission (CVT). The Sportback also gets a lower ride height, revised dampers, 17-inch wheels and revised front and rear fascias.
If you can't wait until the fall, Suzuki has also announced a new pre-paid gas promotion that runs through the rest of the summer. Custormers that buy a new Suzuki SX4 prior to Aug. 31st will get a debit card good for three months of free gas based on various national averages.
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.
It's been in the works since the day Obama took office and now it's official. California can now set its own standards for vehicle emissions, a change that effectively allows the state to regulate fuel mileage.
Several states have already said they will follow California's lead in this area, so the new rules are expected to become a national standard in the near future.
Looks like Consumer Reports has finally caught up with reality. In its latest review of the 2010 Honda Insight, the magazine takes the car to task calling it a, "noisy, stiff-riding car with clumsy handling." First time in a hybrid CR?
As much as we appreciate the technology offered by vehicles like the Prius and the Insight, we've always considered them a huge compromise. You don't get that kind of mileage without giving up a few things, it's not a free ride. Unfortunately, many of the things hybrids ditch in the name of mileage are the very things that make driving enjoyable. Looks like CR isn't ready to make the trade just yet.
This is one new problem GM is more than happy to discuss. Yesterday, officials told Inside Line news that demand for the Camaro has outstripped supply, forcing the company to work overtime at its Oshawa production plant.
According to GM, SS models account for about 70% of its current orders. Black is also the most popular color as 25% of all models are ordered that way. "We think this may stem from the SEMA Black Concept, which was the most popular GM car at SEMA last year," Chevrolet spokesman Adam Denison told Inside Line.
If Hyundai eventually fails in the U.S. market, it won't be for any lack of trying. The company that brought you the 100,000-mile warranty and job-loss protection is now taking the incentives game one step further with guaranteed gas.
Buy any new Hyundai (Genesis models excluded) and the company will lock in your gas at $1.49 for the first year of ownership. Owners will get a gas card that only charges them the set rate and Hyundai will pay the rest. We're guessing it'll go over a little better than Hummer's attempt last year.
Like most automakers, BMW maintains a design studio in Southern California. It's tucked away in the Los Angeles suburb of Newbury Park, so few in the area know it even exists. It's cranked out numerous car designs over the years and its former head, Adrian Van Hooydonk is now the head of BMW design in Germany.
Unlike most satellite design studios, however, BMW Designworks also does contract work for companies outside the automotive industry. Boats, planes, coffee makers, you name a consumer product and Designworks probably has a drawing of it on the walls somewhere. Most of those drawing are rarely seen, but BMW has just posted an in-depth tour of the facility that gives a pretty detailed look at how the studio functions.
There's some good insight into the world of design and how BMW sees its place within that world. If anything, the series might give you a little background on some of the company's more controversial designs and how they made it through the design process.
Newly installed President of Toyota Motor Corporation, Akio Toyoda, outlined his plans for recovery in his first major speech yesterday. Although he gave no specific details, his tried to set the overall tone for the company's recovery.
He emphasized two main points. First, he wants to create a product-focused management. "Rather than asking, 'How many cars will we sell?' or, 'How much money will we make by selling these cars?' we need to ask ourselves, 'What kind of cars will make people happy?' as well as, 'What pricing will attract them in each region?' Then we must make those cars," Toyoda said.
His second area of emphasis was regional expertise. He intends to give his Vice Presidents more control over their individual regions. "Through these processes, I would like to make Toyota's product development and product lineup more region-focused. We will change our policy from achieving 'a full lineup everywhere' to 'a lineup necessary to meet the needs of each region'. We will also launch new vehicles that anticipate consumer needs and are exciting to drive," Toyoda said.
None of it says too much about Toyoda other than the fact that he realizes that product is king. Not a bad trait in a new president though.
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
With the first half of 2009 coming to a close, preparations for the 2010 North American Car and Truck of the Year awards have already begun. The initial list of contenders was released on Monday night and it features a fairly even cross section of the American, European and Japanese vehicles.
To be eligible, a vehicle must be "all new" or "substantially changed" from the previous model and be on sale to the public by early 2010 at the latest.
Notable entries on the list include the Honda CrossTour, an wagon version of the Accord that has yet to be shown publicly and the Suzuki Kizashi sedan which is expected to debut in the fall. The existence of the Toyota 4Runner on the list also indicates that a redesign is on the way by the end of this year.
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."
The U.S. Department of Energy announced today the first installment of loans to promote clean energy. A total of $8B will be handed out to Ford, Nissan and Tesla in hopes of jump starting efforts to produce electric vehicles as well as cleaner internal combustion drivetrains.
Ford will receive $5.9B to to "help finance numerous engineering advances to traditional internal combustion engines and electrified vehicles." The money will also be used to convert two trucks plants into car plants.
Nissan is getting $1.6B to help defray the costs of producing an electric car and battery packs at its Smyrna, Tenn. manufacturing plant.
And finally, Tesla will receive $465M to help develop and build its Model S sedan as well as the production of battery packs in a separate facility.
For the record, GM and Chrysler were not eligible for the program because of their bankruptcy filings. The loan program specifies that any company receiving money must first prove its viability as a stand alone company separate from the loans. How Tesla, which is currently not profitable, got around this provision isn't clear.
So what do you think? Is this a good way to spend federal stimulus money?
Nissan has laid out its plans to produce EVs and batteries (with help from NEC corp.) in the U.S. to tap into low-interest loans. The Japanese automaker applied for $1.1 billion in low-interest loans from the U.S. Department of Energy to fund its building of 50,000 to 100,000 electric vehicles a year by 2012. The site will be Nissan's Smyrna, Tennessee plant.
"We are committed to the vision of energy independence, environmental sustainability, and the new energy economy, and we are hopeful that the U.S. Department of Energy approves this loan request," Nissan said in a statement.
Nissan previously said that it wanted to get its EVs on U.S. roads by 2010, and has been testing a battery-powered prototype of the Cube called the EV-02 across the country.
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.
The next "revolutionary" green car manufacturer has popped up and this time it's the brainchild of former Oracle Corp. executive Ray Varasano.
It's called V-Vehicle, and is backed by a dream team of investors--former oilman T. Boone Pickens, former Mazda N.A. design chief Tom Matano and Fisker Automotive-investor Kleiner Perkins Caufield & Byers have all pumped money into the San Diego-based company.
Unlike Tesla's push for all-electric vehicles, V-Vehicle is looking to make either a more efficient gas powertrain or, considering Pickens is now a natural gas proponent, it might go the CNG route. The company was founded on the ideology that it will build a "high-quality, environmentally friendly and fuel-efficient car for the U.S. market."
V-Vehicle is planning to use a former GM headlight plant in Monroe, Louisiana to build its alternative cars. The plant underwent a $100 million revamp and will employ about 1,400 people from the bayou state.
For those that are interested in hearing more, you can head to the Louisiana Economic Development Web site and get some first-hand commentary from the major investors (keep in mind it's a Louisiana promotional video).
Looks like Tesla is going to have some well-funded competition in the coming years. Regardless of which company comes out on top, it's good to know it will be an American one.
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.
Yet another chapter in the "us vs them" battle will be waged in the California state assembly next week when a bill that would allow more extensive use of speed traps (AB 564) goes to a vote.
Such bills have been popping up all over the country as cities ravaged from the poor economy look for ways to increase revenue. It's essentially a local issue, but when it comes to cars, what happens in California often has a ripple affect across the country. Should this bill go through, expect to see other states follow suit.
If you live in California, do yourself, and your fellow drivers, a favor and tell Assemblyman Portantino, the bill's sponsor, what you think.
There's bench racing and then there's bench buying.
We all know the drill. You go to the official website of your favorite car of the moment, pick a color, add a few options and then get the bad news -- cars are expensive.
Most of the time, it's just a lottery-winning dream, but every once in awhile you have to really get down to business and figure how much you can really afford. It's not always an easy number to figure out, so we've simplified the process with a new affordability calculator on Edmunds.com.
Just plug in the various parameters and you can easily figure out your monthly payment. Too much? Add a bigger down payment and see how much it falls. Still too much? See what a different interest rate can do.
By knowing how all these parameters affect your final bill, you can go into negotiations knowing exactly what you need to do to get the deal done.
Only a couple of days after the New New, New Chrysler started building Vipers again, the company has announced that it will restart production at seven of its other North American assembly plants beginning the week of June 29, 2009.
To the relief of customers who demand engines and bodies on their cars, the company also noted that the powertrain and stamping facilities that supply these plants will also resume operations.
Chrysler will shortly thereafter close the plants for for two weeks as part of its previously announced two-week Summer Break (the weeks of July 13 and 20).
Which plants will get their on-switch fingered? Make the jump for the full list.
The governor of Louisiana announced today that V-Vehicle Company, a San-Diego-based start up, has signed on to assemble "environmentally-friendly vehicles" in an vacant supplier plant. The Monroe, La. facility used to house operations for Guide Corporation, a major lighting supplier.
"Today, we are here to announce that through quick, aggressive action to pursue a transformative opportunity, we have a chance here in Louisiana to re-energize the entire U.S. auto industry. Indeed, this project also has the potential to transform the entire Monroe area, and this project could be a game changer for the economy of Northeast Louisiana," said Governor Bobby Jindal. Louisiana Economic Development: New American Car Company Will Make History In Louisiana
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.
Elon Musk's foot-in-mouth disease appears to be progressing. In an interview at the Disruptive by Design conference in Manhattan, he told Wired magazine Editor in Chief Chris Anderson that he would like a crack at running Detroit.
"When the mess gets sorted out, I'd like to have a conversation with whoever's in charge at the time -- the car czar or whoever -- and say 'I'd like to run your plants, if you don't mind,'" Musk said
Musk probably thinks he can bring all sorts of "Silicon Valley efficiencies" to big auto plants, but he's about two decades behind in that regard. And let's face it, Musk has yet to build a single car on his own yet, so his ability to run even one auto plant is questionable.
Speaking of which, it's been nearly three months since Tesla announced that it was close to securing a site for the production of its Model S Concept car. It's been radio silence on that front since. Not a good sign given that Tesla is still telling people that the Model S will begin production in late 2011.
And for the record, despite the Wired headline, Elon Musk had nothing to do with the founding of Tesla Motors.
You cast your votes and we've posted them. The 2009 Readers' Most Wanted Awards are now live and the Nissan 370Z was your overall favorite. To see the rest of the winners along with comments that accompanied the votes, click below.
Now that Chrysler has emerged from bankruptcy, it can finally resume production at the numerous plants it idled weeks ago. And which plant did it decide to fire up first? That would be the Conner Ave. assembly plant that produces the Dodge Viper.
It only employs 115 people, so maybe Chrysler figured it should start small. According to the article in the Wall Street Journal, Chrysler still expects to end production of the high-end sportscar by the end of the year.
Tired of trying to figure out how the Porsche and the Piech families fit together? Did you always want to know who designed the original 911? Is it Porsche, or Por-sha? Why does the Cayenne exist?
All those answers and more are now available on this lovely DVD titled "The Porsche Way". At over two hours in length, it's a virtual feature film on the history of the German sportscar company.
"This is the first time that a car maker is presented so exhaustively on a DVD", according to Dieter Landenberger, the Director of the Porsche Archives. And if we know the Germans, it will be exhaustively detailed indeed.
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.
International forecasting firm IHS Global Insight has released a detailed report on how it thinks the Chrysler/Fiat alliance will shake out over the new few years.
What's more lucrative than selling Teslas? Being Tesla's legal team of course. After unsuccessfully suing Fisker last year, Tesla's lawyers now have the chance to rack up some hours defending the company from Martin Eberhard, Tesla's co-founder.
Turns out Eberhard was none too pleased about the things current CEO Elon Musk said about him after Eberhard was ousted from the company. After mulling it over for some time, Eberhard finally decided to file suit for defamation among other things, a claim that Tesla calls "twisted and wrong." Well this ought to be interesting.
According to a Chrysler representative, only one measly offer of $5.5M was submitted for the Viper business prior to yesterday's sale of Chrysler to Fiat. The low-ball offer didn't sway bankruptcy judge Arthur Gonzales who promptly transferred all of the Viper assets to Fiat along with the rest of Chrysler.
Does this mean the Viper will live on? Don't get your hopes up. Fiat will most likely spruce up the business and sell it at a later date once more investor money starts getting tossed around.
Honda celebrates the 50th anniversary of its arrival in the United States this week. On June 11, 1959, American Honda Motor Company, Inc. was established in a small store front at 4077 West Pico Boulevard in Los Angeles.
Kihachiro Kawashima was joined by seven employees in the former photo shop. He bought the building instead of simply renting it because he felt that Honda needed to commit itself to this new market in America.
Although the plan had been to sell motorcycles larger than 300cc, the Honda study group noticed that Americans seemed to be more interested in the Honda C100 Super Cub, a small, step-through moped with a relatively clean, quiet, 50cc four-stroke engine. The Super Cub would become the most popular motorcycle in the world in 1959, as more than 500,000 examples poured out of the Honda factories. Kawashima's group sold 1,700 C100s in the U.S. that year.
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.
The Supreme Court cleared a path last night for Fiat's takeover of Chrysler and the two companies wasted no time finalizing the deal. The new company, Chrysler Group LLC, will be led by Fiat CEO Sergio Marchionne.
"This is a very significant day, not only for Chrysler and its dedicated employees, who have persevered through a great deal of uncertainty during the past year, but for the global automotive industry as a whole," Marchionne said in a statement. "From the very beginning, we have been adamant that this alliance must be a constructive and important step towards solving the problems impacting our industry. We now look forward to establishing a new paradigm for how automotive companies can operate profitably going forward."
Automotive News is also reporting that Jim Press will become deputy CEO, whatever that means.
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.
In a statement issued by Justice Ruth Bader Ginsburg, the U.S. Supreme Count did go ahead and put the brakes on Chrysler's sale to Fiat on Tuesday afternoon. But as we reported earlier, most experts feel that the Court will not actually block the deal, but is instead taking additional time to consider the case brought by the Indiana pension funds.
Although concern has been raised that an indefinite delay -- albeit one lasting past June 15 (the deadline set by Fiat) -- could jeopardize the sale, Bloomberg quotes the Italian automaker's CEO, Sergio Marchionne, as saying, "We would never walk away. Never."
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.
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.
Chrysler and Fiat have gotten approval from the bankruptcy court to honor warranty and lemon law claims, Automotive News is reporting. This would apply to all Chrysler, Dodge and Jeep vehicles manufactured in the 5 years leading up to the company's bankruptcy filing on April 30.
This is a turnaround from a May report that indicated customers were already having difficulty getting their lemon-law payout checks honored. Subsequently, several states, led by Iowa attorney general, Tom Miller, went to the court to advocate on consumers' behalf.
You know all those people up in arms about V8-powered SUVs? Well, they're being a bit disingenuous. You see, if they really cared so much about the environment they would be railing against ships too. But they don't, mostly because they don't see them. Out of sight, out of mind you know.
If they did pay more attention, they would realize that the average cargo ship burns fuel oil which is only slightly less toxic that roofing tar. According to a report in The Guardian, the average ship spews about 10.4M pounds of sulfur oxide gases in a year. In comparison, an average car driving 10,000 miles in a year emits a little less than one quarter pound of the same gas. So yeah, ships might be worth looking into if one is serious about reducing airbourne pollutants.
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.
Now that Tesla has backing from Daimler, it's moving aggressively towards an expanded lineup and more affordable models. At least that's what company CEO Elon Musk told Green Car Advisor.
Musk (pictured) said that in addition to the Smart EV, "there is also another major vehicle program that we will be doing with Daimler and that was part of the investment deal and would also fit into the 'everyman' category."
Good to see that Tesla is aiming to bring down the price of its electric cars, but given how much work it has left to do on the Model S, it seems a little premature to be thinking about additional cars down the road.
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 an exhaustive search, General Motors has finally found a buyer for its struggling Hummer SUV brand.
GM released few details about the transaction, saying only that it signed a memorandum of understanding with an outside company. GM also noted that it will continue to build Hummer SUVs for the new owner until at leat 2010.
Microsoft has released this video in conjunction with this morning's E3 press conference. Not a huge amount to see here in terms of gameplay, other than the aforementioned Audi R8 5.2 FSI V10. Ample face time for the Ford GT, too. And there's drifting -- courtesy of an E92 M3 and a 370Z.
In case you're living under a rock, the big video game convention, E3, is happening this week in Los Angeles. The Xbox-only Forza series of racing games have always lived in the shadow of Sony's more popular PlayStation-based Gran Turismo series -- this despite the fact that Forza and Forza 2 are actually really good games.
But this is never-say-die Microsoft we're talking about, and at this morning's press conference, the company announced that Forza Motorsport 3 for the Xbox 360 will include the most highly coveted Audi R8 of them all -- the R8 5.2 FSI V10. Audi says it has been working with Microsoft's in-house developer, Turn-10, to ensure the game car has all the right moves and sounds.
Equally important for the GT-vs-Forza wars, Forza 3 will let you wreck your car in full-on rollover crashes, something Turn-10's Dan Greenwalt demonstrated during today's press conference. Microsoft also announced Forza 3 will be released in October -- two months ahead of the anticipated holiday release for Gran Turismo 5.
To help build anticipation for the game, Microsoft and Audi announced the AXF-24 Audi-Forza Challenge. The top 9 ranked Forza 2 racers on Xbox Live will be invited to New York on June 13-14 to play Forza 3 in a 24-hour endurance race. Drivers will be divided into three teams, and the winning team gets an all-expenses-paid trip to the real 2010 24 Hours of Le Mans.
Microsoft has separately announced a contest in which you can design a skin for the Audi R8 5.2 FSI V10 and compete to win a wireless steering wheel.
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.
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.
Of all the information that has come out of the Chrysler bankruptcy proceedings, a comment by Alfredo Altavillia, Fiat's head or business development takes the cake as the most memorable.
During questioning by bankruptcy judge Arthur Gonzales, Mr. Altavillia said that Chrysler's turnaround won't be much different that Fiat's own turnaround just a few years ago, citing the planned introduction of Fiat's manufacturing system and product development process.
Beyond the top brass, Chrysler staff will remain mostly American.
"We don't intend to ship hundreds of Italians who would get lost in the Wal-Mart," Mr Altavilla said.
Whether you agree with it or not, the current administration is dead set on reducing the country's current level of gasoline consumption. The thrust of its plan so far has been to push impending CAFE regulations from 2020 to 2016, a supply side solution that many see as flawed since it doesn't encourage consumers to buy more fuel efficient cars and trucks.
The alternative most often discussed is an increase in federal gas taxes, a change that would spur demand for fuel efficient vehicles that manufacturers would then have incentive to meet. Seems logical enough, but there's not a politician alive that would want his or her name on that bill.
That sentiment was echoed by Steven Chu , the current Energy Secretary, in an interview yesterday with the Financial Times. Although Chu has voiced support for such a plan in the past, he told the FT that there's no support for it right now. "At this moment, let me be frank, it is not politically feasible."
So in other words, although the Energy Secretary thinks a gas tax would be effective, the rest of the government will satisfy itself with a plan that it knows isn't likely to work. Oh well.
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.
For the first time in nearly two years, the average price of diesel fuel has fallen below regular gas. According to the Energy Information Administration (EIA), it's a "traditional" spring inversion that occurs in the U.S., but there's no doubt that BMW, Mercedes and Volkswagen will try to take advantage of the new pricing structure.
All three automakers took the plunge and introduced new diesel models in the last year, but apart from strong sales of Volkswagen's TDI cars, sales have been disappointing. As Bill Visnic points out on AutoObserver, several other manufacturers had diesel programs in the works, but shelved them when got prices plunged.
Now that prices have evened out, and stricter CAFE regulations are on the way, there are some incentives to get those programs moving again. Hard to tell if consumers would respnod at this point, but it seems like it's worth another try given refined and quiet modern diesel engines have become.
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?
We've had our doubts about this whole Fiesta movement thing. It was a brilliant marketing plan as giveaways tend to be, but unless someone is going to try and jump the Snake River in one who cares what the winners do with them?
Don't worry, Ford created reasons to care. Ploy number one: pretend a Fiesta was stolen. Oh the humanity.
It was a slightly amusing story right up until the car's owner spotted the car sitting in a local impound yard. So theoretically, the thieves could have stolen the car, parked at the curb to get some post GTA cheeseburgers and forgotten to feed the meter. Or it's all crap.
Mahindra and Mahindra has once again delayed the introduction of its compact pickup truck in the States. The company now says it will introduce the truck sometime in 2010.
The Indian company originally planned to build the truck in a plant in Ohio, but it now says it will import fully assembled trucks from India. Even with the so-called 25% "chicken tax" on imported trucks, Mahindra says it's still cheaper than getting a U.S. plant ready for production.
The Mahindra pickup is expected to use a 2.2-liter diesel engine and a 6-speed automatic transmission and sell for $22,000 to $25,000.
UPDATE: Mahindra spokesman Mike Geylin says the original report misquoted the company's representative. The company is still planning to start sales of its compact truck later this year in select markets.
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?
Earlier this week, actor Alex Baldwin said the Big Three should die. Well, his exact words were "pull the plug," which is way different according to Baldwin's follow up post.
When he said pull the plug, he meant end government subsidies. In other words, he wants the industry to survive, he just doesn't want to pay for it. Fair enough.
But then he goes on to voice his support for auto workers. In his mind, they deserve little if any blame for the situation. It was all management's fault. Or the government's fault.
The workers? They were led astray by their UAW leaders.
So yeah, Baldwin is still off his rocker, but we'll give him some credit for realizing how wrong he was the first time.
Here's your chance to score that Jeep Grand Cherokee SRT8 you've been dying to see in your garage. Terminated Chrysler dealers are clearing out their remaining inventory and very often taking a bath in the process.
Chances are you're not going to find any SRT8s laying around, but Ram trucks, minivans and Wranglers should be available. Don't bother insulting the dealers with ridiculous low-ball offers though, they're not under that much pressure.
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.
Chrysler announced today that C. Robert Kidder will takeover as Chairman once its merger with Fiat is wrapped up. Kidder takes over from Bob Nardelli who will return to Cerberus Capital to work as an advisor.
Kidder currently serves on the boards of Morgan Stanley, Schering-Plough and Microvi Biotech Inc. He previously served as CEO of Duracell International and Borden Chemical Inc. and is currently CEO of 3Stone Advisors LLC, an investment firm that specializes in clean-tech companies.
Are you sensing a pattern here?
If not, here's a hint. Chrysler will once again have a top executive with little to no experience in the automotive industry. It appears as though even Chrysler was aware of how this might look so it added a line to his bio that mentions Kidder's work with a "major OEM client in the automotive industry" during a stint at McKinsey.
Alec Baldwin is a great actor. From the ultimate sales speech in GlenGarry Glen Ross to his current work in 30 Rock, the guy can bring it when the cameras are rolling.
Away from the cameras, however, Baldwin is somewhat less impressive. Take his latest diatribe in the Huffington Post. in which he makes the case for letting the Big Three die because they didn't focus on building more efficient cars.
"There can be only one legitimate response to this crisis. Let energy conservation and fuel efficiency rule the day. Let the carmakers go under."
It's a nice sentiment, but Mr. Baldwin is conveniently forgetting that the company that built his Prius made most of its profits in the U.S. selling trucks and SUVs. If Toyota had to rely on sales of small cars to survive, it's U.S. operations would be going bankrupt too.
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.
It's not a marriage of convenience, and according to AutoObserver, it's not a marriage that will last either. We're talking about the Fiat/Chrysler merger and history says it's doomed.
Richard Feast, a long time industry observer, lays out a litany of failed mergers that have transpired over the last several decades and they don't bode well for the latest attempt.
Although he does give Fiat CEO Sergio Marchionne credit for turning around the struggling Italian automaker, Feast says the Marchionne is attempting to achieve even greater success by bringing together several mediocre brands under one roof.
You know it's serious when the White House lines up the CEOs of nearly every major car company in the U.S. for a press conference. The occasion was the announcement of new fuel efficiency rules that will reset the standards for cars and trucks going forward.
They're much tougher standards that the current rules. We're talking an average of 39mpg for cars and 30mpg for trucks and SUVs by 2016 for a combined average of 35.5mpg.
The White House acknowledges that costs will go up for cars and trucks, but claims that consumers will save at the pump in the long run. There are still many details to be worked out, but this appears to be the basic plan going forward. Think it will work?
Edmunds' Green Car Advisor's Scott Doggett picked up an interesting story on Darryl Siry, former head of marketing for Tesla Motors, today. In a lengthy entry on his personal blog, Siry writes that the EPA's mileage range estimates for electric cars are way off base.
He points out three big problems with the current methodology:
--Range estimates reflect upper-end limits and don't take into account varying driving styles and conditions. Obviously, this affects cars with internal combustion engines, too, but electric cars are more sensitive to aggressive throttle use. --These range estimates are often developed with a full state of battery charge, something a normal owner will rarely if ever experience. --As batteries age, their maximum charge capacity decreases, resulting in reduced range over the life of the car (or at least the life of its battery pack).
These problems will have to be resolved, says Siry, to avoid widespread disappointment among future electric car owners.
As Chrysler's "quick-rinse" bankruptcy progresses, all sorts of nagging little issues are bound to pop out of the woodwork. For instance, what do you think might happen if Chrysler bought your vehicle back under your state's lemon law and you try to go deposit your payout check?
For several buyers in California, the answer is that check's going to bounce, the Los Angeles Times reported today.
Financial claims made before the automaker sought Chapter 11 protection on April 30 can only be paid out with approval of the bankruptcy judge, and says the Times, "Chrysler has not asked for permission to make payments on lemon law complaints."
So what recourse do you have? File a proof of claim with the bankruptcy court and join the long line of unsecured creditors hoping to collect.
New fuel economy rules are expected to come from the Obama administration on Tuesday, major media outlets are reporting. Reducing carbon dioxide emissions in the goal, and here the federal government is expected to borrow from California's playbook, which seeks to cap CO2 emission levels rather than forcing fixed mpg standards, the Los Angeles Times reported.
This move would not affect California's bid to regulate its own emissions, said the Times, as that case is still pending before the EPA.
The new CO2/fuel economy rules are expected to require manufacturer fleets to average 35 mpg by 2016, and as Edmunds' Auto Observer reports, the White House seems to have quite a few automakers on-board with this. GM and Chrysler are gimmes, of course, but Ford and BMW are also said to be supporters.
As expected, the 789 rejected Chrysler, Dodge and Jeep dealerships are not going down without putting up some kind of fight.
Automotive News is reporting that the national dealer group has filed a motion in U.S. Bankruptcy Court asking that all legal protections (read: state franchise laws) the dealers would have outside of bankruptcy court be honored here.
A judge will hear the case on June 4, just 5 days before Chrysler announce it would end operations at the affected dealers. Notably, says AN, Chrysler would not buy back the remaining vehicle inventory and parts at the rejected dealerships, but would merely steer those owners toward surviving dealers that might wish to purchase it.
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.
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.
One prominent car on the auction block at the Mecum Indy auction this weekend is this 1965 Shelby Cobra Daytona coupe. This isn't a kit car replica by any means. It's Shelby Cobra CSX 2601, the car Bob Bondurant drove to victory in the 12 Heures du Reims on July 4, 1965, beating Ferrari's GTOs. This win was enough to secure the FIA championship for Team Shelby, aka Team America.
This Cobra is part of a lot scheduled to be sold at 8 p.m., Friday May 15 (editor's note: date corrected) in Indianapolis. If we had to guess, we'd hazard to say someone will pay too much for it.
Hard financial times at Toyota will be met with swift action when Akio Toyoda takes over as chief executive in June, the Financial Times is reporting. Following the company's recent full-year loss of $8.6 billion, Toyota is planning to replace 40 percent of its senior management. Toyoda is working to assemble his new team while he waits to be confirmed by a vote of Toyota's shareholders on June 23.
One of the biggest changes is likely to come here in the U.S., as FT suggests that Toyota might consolidate its California-based sales operation and its Kentucky-based manufacturing operation under one roof -- based in New York.
Yoshimi Inaba, who once led the company's sales and marketing operations in the U.S. and China (and who now runs the Nagoya, Japan, airport), will lead the overhaul effort in North America.
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.
A so called "Cash for Clunkers" bill is currently weaving its way through Congress, but as Bill Visnic points out on AutoObserver, its ability to stimulate car sales is still very much in question.
Why? Like so many other bills in Congrees, the Cash for Clunkers legisation is attemtping to please two different sides of the issue. In this case, it's the car industry and environmental groups. Not surprisingly, the goals conflict, and as Visnic points out, it could end up watering down the bill to the pont of complete ineffectiveness.
Last August Inside Line scooped the world with a report that Nissan is working on a convertible version of its Murano crossover. Yeah, it sounded nuts to us too, but it was true then and it is true now.
Sources inside Nissan tell us the droptop SUV is still a go and will arrive at dealers before the summer of 2010.
Much of the information we published last August is still right on. The 2011 Murano convertible will be produced in limited numbers, and will be targeted at empty-nesters who need room to carry the grandkids, but still want something fun. And like the new 370Z convertible, it will stick with a more traditional soft top to keep weight and cost down.
The Murano's current 265-horsepower 3.5-liter V6 and continuously variable transmission (CVT) will remain, and front- or all-wheel drive will be available.
However, we did get one thing wrong. Unlike the image above, the 2011 Nissan Murano Convertible will be a two-door. That's right, sort of like a higher riding PT Cruiser convertible.
It's not as simple as you might think. Base price is one thing, but depreciation, insurance, gas costs factor in there too. Edmunds own John Giamalvo spoke with CNBC recently and profiled several cars that represent the best value in their segment.
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.
Chrysler can't catch a break these days and it needs one if it's going to stay alive past the summer. Automotive News is reporting that some Chrysler dealers are now getting together to hire a law firm to protect their franchises. Most of them are afraid that the "new" Chrysler that emerges from bankruptcy will pick the dealers it wants and leave the rest hanging.
In a related story, Alex Taylor III from Fortune magazine highlighted additional problems facing Chrysler. One is product development or lack thereof. One engineer told Taylor that you can't just stop and a program and start again where you left off as crucial knowledge gets lost along the way. He figures this will cause current programs to take one-and-a-half times longer than they would have otherwise.
Another basic problem? Paint. It can't just sit in the pipes when the plant is shutdown. "Paint should be removed and stored after 21 days at a cost of $2 million," a Chrysler engineer told Taylor. "After 69 days, paint would need to be replaced at a cost of $15 million."
As we feared, nothing about this bankruptcy is going to be quick and efficient.
Another chapter has ended in the Chrysler bankruptcy saga. Remember the evil hedge funds that were holding out to get the money they were rightfully owed?
Well, they've turned over a new leaf and agreed to the government's offer. Of course, they gave no reasoning why they suddenly found its reasonable to accept roughly 30 cents for every dollar they were owed. Maybe it has something to do with a little arm twisting by the White House? Or maybe not.
The ol' hydrogen highway just got a little bit shorter. At a press conference today, Energy Secretary Stephen Chu announced a budget that slashes spending on hydrogen research by 59%.
"We asked ourselves, 'Is it likely in the next 10 or 15, 20 years that we will covert to a hydrogen car economy?' The answer, we felt, was 'no,'" Chu said in the briefing today.
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.
Since YouTube is so last month, Inside Line has now set up an official video channel on Hulu.com. Now when you're done watching the latest episode of The Office you can follow it up with a few road tests or spy videos. Let us know what you think.
With news that Chrysler will most likely shutter its Sterling Heights, Michigan assembly plant as part of its bankruptcy proceedings, the Chrysler Sebring and Dodge Avenger appeared headed for extinction.
According to Chrysler spokesman Rick Deneau, however, there are still plans in place to build both models after the plant closes in 2010.
"We definitely have plans for these vehicles beyond December 2010," Deneau told Inside Line. "That's about all I can tell you, but it's pretty definitive."
With programs in Europe proving successful, Congress has agreed on some early framework for a so-called "cash for clunkers" bill that would offer consumers up to $4,500 for replacing an older car or truck with a new, more efficient model.
It's part of a plan that aims to jumpstart auto sales and reduce the number of older, less efficient vehicles on the road. Some enthusiast groups object to such bills saying it will unnecessarily accelerate scrappage of older vintage cars.
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.
Here they are, your new Chryslers. Well, maybe they'll still be badged as Alfas or Fiats, nobody really knows at this point. What we do know is that these four vehicles and the Fiat 500 will represent the bulk of Fiat's contribution to Chrysler's lineup.
They include the Alfa Romeo MiTo (bottom right), an upcoming replacement for the Alfa 147 (top left) that will be renamed Milano, the Fiat Grande Punto (top right) and a version of the Fiat Panda utility vehicle (bottom left).
Bankruptcy documents submitted in court yesterday don't bode well for vehicles like the Dodge Viper and even the Jeep Wrangler. Problems trying to offload the Viper business have been discussed for months now, but the new documents also point out the difficulty of trying to sell Jeep as a separate brand. One consultant estimates it would take as much as $1B to restart a product as a stand alone brand.
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."
The whole Chrysler situation is getting stickier by the day. Now a bankruptcy lawyer who represents some of the investment firms that didn't agree to the bailout plan says that Steven Rattner, head of the Presidential Task Force on Autos, told him that the full force of the White House would be used against those who didn't agree to the bailout.
Thomas Lauria, Global Practice Head of the Financial Restructuring and Insolvency Group at White & Case, first told the story to Detroit radio station WJR-AM. At the time, he didn't single out Rattner by name, but in a subsequent interview with ABC News he revealed additional details.
A White House press secretary denied the accusation.
Remember last week when President Obama said that the Chrysler bankruptcy would be "fast and efficient"?
So much for that idea. The Detroit Free Press is reporting that the proceedings have already been delayed by the bankruptcy judge. Turns out Chrysler was supposed to submit its plan to the court on Friday but only managed to get it in last night.
The holdout investors, otherwise known as the evil hedge funds, called BS and the judge agreed. The investors also asked that the judge keep their identities secret as those that were already identified have received death threats.
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.
Last week it was Chrysler, this week Fiat is attempting to buy Opel, GM's German subsidiary. The goal is the formation of a European supergroup similar in scope to Volkswagen.
According to a report in the Financial Times, Fiat CEO Sergio Marchionne aims to split Fiat's car operations from the conglomerate's other businesses and combine it with Opel, Saab and its newly acquired stake in Chrysler. "From an engineering and industrial point of view, this is a marriage made in heaven," Marchionne told the FT.
History shows that such mergers rarely end up creating much value, but Marchionne is hoping that the depressed state of the industry opens a few door in his drive to remake Fiat into a global powerhouse.
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."
It looked as though Chrysler avoided certain catastrophe yesterday when the U.S. government pushed through a deal with Fiat. The new partnership guarantees that Chrysler will receive a sizable chunk of government money to stay afloat, but it doesn't guarantee that Chrysler will get cars from Fiat that Americans will want to buy.
A study published in Whatcar? magazine in the U.K. shows that Fiat is far from popular in Britain. And as you may know, they actually seem to like small cars over there.
Fiat's latest cars are said to be considerably better than their lineup from just a few years ago, but from the looks of this study, they didn't have anywhere to go but up.
So now that Chrysler is on the way to a shotgun wedding with Fiat, what will the new company be called?
FiatChrysler? ChryslerFiat? Fiatler?
It sounds like a secondary decision, but when Chrysler hooked up with Daimler, the issue simmered for a long time before Chrysler agreed to let Daimler go first. Doesn't seem like Chrsyler will have much of a say this time around.
Chrysler's odd three-headed management system is about to get a little more streamlined. After today's bankruptcy announcement, Chrysler's current Chairman and CEO Bob Nardelli announced that he would leave the company and return to Cerberus Capital Management as an advisor.
Tom LaSorda, the long time Chrysler manufacturing executive and the company's current Vice Chairman and President, also announced today that he will retire once the Fiat deal has been completed.
Jim Press, the former Toyota executive who also holds the title of Vice Chaiman and President says he has no immediate plans to leave the company.
Then again, it won't be long before Fiat is calling the shots, so Press may not get to stick around even if he wants to.
Mazda has now confirmed what Inside Line reported over a month ago. Derek Jenkins, former head of Volkswagen of America's design center, has been named Design Director, Mazda Design Americas.
Jenkins is best known for projects like the Volkswagen GX3 and R-GT concepts.
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.
After a public debut on March 23 in Mumbai, the Nano officially went on sale from April 9-25. For a fee of around $6, customers could apply to purchase a Nano at more than 30,000 locations in 1,000 cities across India. Orders could also be submitted online.
The response to this unusual booking process appears to be overwhelming, so much so that Debasis Ray, Tata Motors' head of corporate communications, told Inside Line the results are still being calculated days after the order books were officially closed. Several Indian media outlets have reported that Nano bookings could reach 1 million, though Ray said he had "no idea" where these publications were getting that figure.
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.
Bloomberg is reporting that President Obama will announce Chapter 11 bankruptcy for Chrysler tomorrow morning. The move is designed to facilitate a merger with Fiat which would own 20% of the new company while the UAW would own 55%.
Update: The Washington Post is now reporting that Chrysler CEO Bob Nardelli will be replaced by Fiat management as part of the bankruptcy plan currently being developed by the Obama administration. Fiat would eventually own 35% of the new company while the U.S. government would 8% and the Canadian government 2%. Cerbereus Capital would no longer have a stake.
You're probably not familiar with the name Source Interlink, but you've probably read some of its magazines. Along with well-known titles like Motor Trend, Automobile, Hot Rod and Car Craft, Source Interlnk also publishes dozens of smaller enthusiast magazines focusing on everything from 5.0 Mustangs to Jeeps.
According to a report by Bloomberg this morning, Source Interlink has filed for bankruptcy protection and is seeking to go private.
For now, the magazines are probably safe from any immediate changes, but if you're a fan Source's smaller publications, don't be surprised to see some of them fall by the wayside as the company restructures.
Think you had a rough Monday? Daimler's was worse.
It started the day by giving up completely on Chrysler. Daimler held on to 19.9 percent of Chrysler in hopes of salvaging its disastrous merger. Well, that didn't work out too well, so Daimler agreed to give up its remaining shares to Cerberus. Daimler also forgave $700M in loans it made to Chrysler and agreed to contribute $400M to Chrysler's pension plans over the next two years. Ouch.
Later in the day, Daimler announced that it had lost $1.86 billion in the first quarter of 2009. Daimler had already written off its stake in Chrysler, so those losses aren't even the result of the earlier agreement.
So there you have it, the Daimler merger with Chrysler is officially a disaster from start to finish. Nice idea, Juergen Schrempp, hope you're enjoying retirement.
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.
Honda has continually said that plug-in hybrids are an unnecessary step on the road to hydrogen-fueled vehicles.
Now it's changing its tune given the U.S. government's preference for plug-in hybrids as a short-term solution. Green Car Advisor has the full story on Honda's about face.
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?
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.
Earlier this week, Volkswagen announced that it would build its new minicar lineup in Slovakia starting in 2011. The new vehicles would be the production versions of the Up! minicars shown at the 2007 Frankfurt and Tokyo shows.
Today, Volkswagen of America told Inside Line News that this lineup was definitely headed to America. Which models and what they would be called are still being determined.
You know it's bad when Ford loses over $1B in three months and the markets consider it a promising sign. Then again, the markets were predicting Ford would lose over $3B in the first quarter, so it's all relative we suppose.
Ford's stock has more than doubled in the past seven weeks to over $5. Much of the optimism is tied to the company's ability to get by without government loans.
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.
Just when you thought Porsche might eventually swallow Volkswagen, now comes a report from the Financial Times that it might actually be the other way around. VW might buy up Porsche's sports car business.
You'll recall that Porsche increased its stake in Volkswagen to over 50 percent in January and said it would keep buying up shares in VW until it had a 75-percent stake. Note that it's Porsche SE, a holding company jointly owned by the Porsche and Piech families, that owns the stake.
FT reports that Ferdinand Piech, chair of Volkswagen and co-owner of Porsche, is considering buying up Porsche's automotive division (Porsche AG) and integrating it into the VW family as a 10th brand. This sale would possibly pay down some of the debt Porsche SE is said to have amassed during its buying spree. The holding company would keep its stake in VW.
U.S. Attorneys have charged the owners of a New York Bentley and Aston Martin dealership with corporate espionage after discovering they had tapped into the email network of a rival Ferrari and Maserati dealership.
According to Bloomberg, Giacomo Ciaccia and Leka Vuksanaj, the co-owners of Universal Autosports LLC,were former employees of the Ferrari dealership. A third man, Michael Lussos, listed as the Creative Director of Universal Autosports, helped to set up the email system for the Ferrari dealership.
Investigators discovered that the Ferrari dealership's email were being forwarded to an outside account. In some instances, Universal Auto sport attempted to use the information to thwart potential sales by contacting customers directly. The three men each face up to five years in jail and a fine of $250,000.
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.
Massachusetts is considering two different plans to increase revenues and decrease gasoline usage throughout the state. Both plans have their opponents, but as Bill Visnic explains on AutoObserver, one plan has some merit, the other is quite ludicrous.
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?
There aren't many real speed shops left anymore. Thanks to the internet, ordering parts has become a simple click and ship proposition for most people. Every once in awhile, though, you actually want to hold something in your hand before deciding to lay out the cash for it.
Now there's a new website that will help you find the nearest parts store that has what you're looking for. It's called www.findfastpartsfast.com and it's sponsored by the Performance Warehouse Association (PWA).
Obviously the results are only going to give you shops that deal with the PWA, but we tried it a few times and it seemed to deliver usable results. Check it out the next time you need some speed parts, trust us, these shops need the help.
It's official now, cars will be the death of us one way or another. The EPA has officially declared carbon dioxide a health hazard. Expect too see a new round of draconian emissions rules any day now. Enjoy those new muscle cars while you can, they won't be around for long.
It appears as though there's a bit of a Fiesta movement going on in Europe already. The bite size hatchback became Europe's best selling car in March with 52,805 units sold. Volkswagen's Golf had previously held that title.
That said, we're still waiting for the Fiesta here in the U.S. and it won't be headed our way anytime soon. Sure, Ford handed out 100 Euro-spec cars to obsessive Twitter tweakers so they could tell everybody how much they like the car that isn't costing them a dime, but actual customers will have to wait until next year to buy U.S. versions.
Last we heard, Mr. Keenan of Tool fame was making wine in Arizona. Thankfully, the Mustang has continued its role as a burnout machine unabated during its entire existence.
The Mustang's story of initial success is one of those fables we Americans learn alongside George Washington and the cherry tree and Abraham Lincoln's birth in a log cabin.
Exactly 45 years ago, on April 17, 1964, Ford debuted the Mustang at the New York World's fair and put it on sale at dealers across the country. Before the day was through, they had sold more than 22,000 of the new sports coupes and convertibles with prices starting at just $2,368.
Just 12 months later, a staggering 417,000 had found buyers. By early in the 1966 model year, over 1,000,000 were out on America's highways. And last year Ford sold its 9 millionth Mustang.
You may have seen the findings of an IIHS report released earlier this week. It showed the shocking truth behind collisions between vehicles of different sizes. The conclusion? The bigger one wins. To see for yourself, watch the video below.
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.
