UAW Tries Unionizing Toyota

The Union Auto Workers (UAW) will host a meeting of Toyota factory workers Saturday in Lexington, Ky., as a step in trying to unionize Toyota’s oldest and biggest U.S. plant.

The union says the meeting will be a town hall forum to air their grievances and to provide “an opportunity for Toyota workers to share with the community the human cost of Toyota's success," said a union official.

The UAW is desperate to maintain its shrinking ranks, but has been unsuccessful in organizing Asian-owned factories.

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Chrysler Close to Sale?

Next week could see significant movement in the sale of Chrysler Group.

DaimlerChrysler holds its annual shareholders meeting Wednesday in Berlin. It is possible that bids for Chrysler could be received by the automaker’s investment banking firm, J.P. Morgan Chase, by then. No formal bids had been received as of yesterday.

However, Detroit newspapers are reporting some bids are close to being sent. Three potential buyers supposedly have the inside track: private equity firm Blackstone Group, teaming with Centerbridge Partners; private equity firm Cerberus Capital Management; and Canadian auto supplier Magna International Inc.

The Detroit Free Press reported an Asian link -– from China or India -– is likely, but offers no solid evidence beyond an analyst’s conjecture to support the claim.

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Chevys Replace Saturns in Spring Hill, Tenn.

General Motors told employees at its Spring Hill, Tenn., plant that the factory will get a new product to replace two Saturn models, which end production today.

It sounds like the Tennessee plant will get the new Chevrolet crossover vehicle, based on the same architecture as the recently introduced Saturn Outlook and GMC Acadia and the upcoming Buick Enclave. Edmunds.com’s Inside Line reported this week that the Chevy crossover in the works for the 2009 model year may be called "Nomad," reviving a storied nameplate that dates back to the 1950s and a 2004 concept vehicle.

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Where Have All the Women Gone?

The drain of talent, both male but especially female, is one of the most dangerous signs of weakness for Big Three automakers and top suppliers, says a former Ford executive and television broadcaster turned industry consultant.

Anne Doyle, president of Anne Doyle Strategies, is a leadership and communications coach appearing on the television program, AutoLine Detroit, which began airing Sunday. Hosted by John McElroy, the show’s segment features Sarah Webster of the Detroit Free Press and me as guest panelists to discuss the massive departure of women from the top ranks of the auto industry.

For few decades, women executives were on the rise. The 1990s, says Doyle, a pioneer in sports broadcasting in Detroit before she went to Ford, were the golden years for women in the auto industry. But in the last few years, an alarming number of top-level female auto executives have left the industry. Scan the list of Automotive News top 100 women in the U.S. industry, published in 2005. A number of the women have left the auto industry for extremely significant jobs in other businesses.

One of the highest profile women to leave the industry of late was Anne Stevens, one of the industry's highest ranking women. She had been Ford executive vice president and chief operating officer of the Americas, working with Ford President of the Americas Mark Fields, heading the automaker's turnaround plan. She left Ford to take a top job with Carpenter Technology Corp. in Pennsylvania late last year. And just this yesterday, Ford announced its treasurer, Ann Marie Petach, was leaving to take a newly created position with BlackRock Inc. as managing director and head of business finance.

Downsizing isn’t the only reason, says Doyle. Many women are abandoning the auto industry for a better life, both professional and personal.

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“SpongeBob” Rides in Chryslers

Chrysler Group and Sirius Satellite Radio announced today that Chrysler will be the first and only auto manufacturer to offer Sirius Backseat TV in its vehicle lineup in the 2008 model year.

The feature debuts on 2008 Chrysler Town & Country and Dodge Grand Caravan minivans. It will also be available on the 2008 Chrysler 300, Dodge Charger, Dodge Magnum, Jeep Commander and Jeep Grand Cherokee. Chrysler sees innovative technology as a way to stand out from the crowd, generally, and in minivans, specifically.

Three channels of family TV programming -- from Cartoon Network, Disney Channel and Nickelodeon -- will be delivered directly to the vehicle. Rear-seat passengers will be able to watch shows such as Nickelodeon’s SpongeBob SquarePants, Disney Channel’s Hannah Montana and Cartoon Network’s Foster’s Home for Imaginary Friends.

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Cerberus: Expanding Its Auto Base

If you work in the auto industry, Cerberus Capital Management may well be your next employer.

The private equity firm is becoming a household name in the auto industry, especially in Detroit, as it expands its automotive base and shows interest in even more holdings.

On Wednesday, after the stock market closed, it was announced that Cerberus had agreed to buy bankrupt auto supplier Tower Automotive Inc., in a deal valued at about $1 billion.

Cerberus is said to be a front-runner to purchase Chrysler. It is part of a group planning an investment of up to $3.4 billion for bankrupt Delphi Corp. Cerberus led a consortium of investors to buy 51 percent of General Motors Acceptance Corp., a deal worth $14 billion in cash over three years to General Motors. And Cerberus purchased the flooring and acoustics business of Collins & Aikman, another bankrupt automotive supplier being dissolved.

Not only is Cerberus adding to its holding, its adding high-powered automotive talent to its roster. Cerberus just signed Wolfgang Bernhard, formerly of Chrysler and Volkswagen, on as an advisor, likely to provide guidance in a potential Chrysler purchase. Cerberus also signed on former Ford executive Robert Rewey. They join former Ford executive David Thursfield, who heads Cerberus’ automotive unit.

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Chevy Unveils a Trio of Minicar Concepts

General Motors’ Chevrolet division will unveil a trio of minicars at the New York auto show next Wednesday. The automaker has released a photo of one of the three, one called the Chevrolet Trax.

By unveiling the minicars in New York and allowing visitors to vote for their favorite of the three on www.vote4chevrolet.com, GM certainly is exploring the minicar segment in North America, where it has no such offering at the moment. However, the minicars are more important for world markets, where Chevrolet is vastly increasing its presence and sales.

The minicar unveilings are also intended to further emphasize the message GM has been trying to get across; that is, it is a global company with global design and manufacturing capabilities, resources it is leveraging across the world.

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Toyota Enriches Tundra Incentives

Toyota has added dealer incentives on some versions of its newly launched Tundra full-size pickup truck in an effort to stir slow sales, Edmunds.com’s AutoObserver has learned.

“Toyota apparently is coming up short on sales numbers and wants to drive volume,” said Alex Rosten, manager of pricing and market analysis for Edmunds.com’s AutoObserver. “This is not a good sign for Toyota.

Tundra incentives are: 3.9 percent to 5.9 percent financing on all models, depending on the loan term; special lease rates on all models; $1,000 trade-in assistance for early termination of leases on the previous-generation Tundra; $2,000 dealer cash incentive on Regular Cab models; $1,000 dealer cash incentive on Double Cab models. The incentives run through the end of April. Some dealers already were offering as much as a $1,500 discount on the basic Tundra work truck, which is selling particularly slowly.   

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UAW’s Gettelfinger: A Rock and a Hard Place

Talk about being stuck between a rock and a hard place.

UAW President Ron Gettelfinger opened Tuesday’s convention of 1,500 union delegates in downtown Detroit with a fiery speech about protecting worker interests amidst pressure by Detroit automakers for concession. The convention marks the start of negotiations between the UAW and Detroit automakers for a new contract to replace the one that expires in September.

“Our union does not want to strike,” Gettelfinger told delegates, “but when employers act as if collective bargaining is a one-way street and not a two-way street, we will do what we have to do.

“Collective bargaining is not collective begging,” he added, drawing cheers from delegates. “Where we have demonstrated cooperation, it would be a grave mistake to equate our action to capitulation.”

Despite the tough talk, Gettelfinger is a smart man. He recognizes General Motors, Ford and Chrysler are in a tough spot, having lost money as well as sales and market share to Asian automakers and are encountering soaring health care costs and unfunded pension liabilities.

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Mulally: Ford Will Expand Partnerships

Ford CEO Alan Mulally said Ford will expand its collaboration with other automakers, particularly in such areas as powertrain engineering and manufacturing.

In an interview with trade journal Automotive News, Mulally said he has made it a priority to meet leaders of other auto companies during his first six months on the job. He now says he's "just about talked to all of them" and that new business relationships are likely to result.

"We have a really good set of partners and alliances on both technology and the vehicles themselves," Mulally said in the interview. "As we go forward, we'll see more of it. Even more collaboration will be a big part of our plan."

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Votes for Volt

So far, the vote is overwhelming: 440,000 to 2,200.  

As of this week, General Motors’ “Vote for Volt” Web site has 440,000 visitors voting in favor of GM building the Chevrolet Volt plug-in hybrid concept versus 2,200 voting nay.

At the same time, GM Vice Chairman Bob Lutz in his Fastlane blog this week blasts naysayers, who claim the Volt is nothing more than a publicity stunt. Lutz’s comments came in response to a Detroit News article that said GM was “unplugging” the Volt, trying to tone down the publicity and expectations around the concept.

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Porsche Ups its VW Stake; Piech Firmly in Control

Porsche confirmed today it has exercised an option to take an extra 3.6-percent voting stake in Volkswagen, raising its holding to 30.9 percent. That puts Ferdinand Piech firmly in control, and blocks unwanted suitors, like hedge funds and buyout firms.

German law requires Porsche make a takeover bid to other VW shareholders if it raises its stake past 30 percent. To that end, Porsche said Saturday it expected to offer 100.92 Euros per VW ordinary share plus the legal minimum for VW preference shares. By offering investors the minimum amount required, Porsche gets a great deal. It gets a huge discount on Friday’s closing price of 117.70 Euros and crosses the 30-percent milestone cheap and cannot be forced to launch a bid again.

In a statement issued over the weekend, Porsche said it was “firmly convinced that a closer bond with VW through an increase of the stake to more than 30 percent of the Volkswagen ordinary shares will produce benefits for both partners without diluting or indeed endangering the identity of Porsche." A Porsche spokesman insisted the company does not want to own a majority of VW.

The announcement caps months of speculation that a bid was imminent, driving VW stock up by more than a third this year to record highs. It also cements Ferdinand Piech’s control over VW as well as Porsche, in which he owns a principal stake.

Now the question is what will Piech’s control mean. Can he and the lieutenants, led by former Porsche CEO Wendelin Wiedeking who now heads VW, make VW as profitable as Porsche. Can he turn around the VW brand and make the necessary cuts? Will he make costly mistakes like he did in his previous tenure at VW with such things as the purchase of Lamborghini and Bugatti and the development of the VW Phaeton luxury car.

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Edmunds.com: March Sales, Though Down, May Be Best of the Year

The good news is: March may be one of the best months of 2007.

The bad news: March sales will be lower than last year and still be one of the best months this year, suggesting little for the industry to look forward to for the rest of the year.

This month's new vehicle sales (including fleet sales) are expected to be 1.48 million units, a 3.0-percent decrease from March 2006, according to Edmunds.com. Though sales are lower this March than last, Jesse Toprak, executive director of Industry Analysis for Edmunds.com, notes more cars were sold in March last year than any other month of last year. He predicts that this March may be one of the best months of 2007.

"This month, the industry faced debilitating winter storms, less compelling marketing messages and reduced fleet sales, so it is no surprise that year-over-year comparisons reflect a relative downturn," said Toprak. “Nevertheless, I believe we are still on track for annual sales volumes of approximately 16.5 million vehicles, along the lines of what we saw in 2006."

Typically, the summer has been the strongest period for new-car sales. This may be shifting because new-model introductions come earlier in the year than they used to, possibly sparking traffic to showrooms during historically quieter months.

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In the Media: Saturn Surge

Detroit’s NBC affiliate, WDIV, aired a story on its Auto Insight report on Saturn’s growing success. The report stemmed from and included me citing an Edmunds.com’s AutoObserver report on Saturn’s surprising 60-percent increase in sales in February and heavy cross-shopping of Saturn’s new models by prospective Toyota, Honda and Nissan buyers.

An interesting tidbit uncovered by WDIV anchor Guy Gordon was the fact that the Saturn of Troy dealership, the Troy, Mich.,-based showroom where the segment was filmed, has engaged for years in a friendly competition with the neighboring Toyota dealership. Both owned by the same dealer, the two have run neck-and-neck in sales. But the Saturn dealership began pulling ahead last fall, and this month is likely to be 100 cars in front of the Toyota dealership.

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Heard on My Street: GM Crossover, Super Duty Buzz

My Sunday afternoon nap was interrupted by a neighbor pounding on my door. She was desperate to get a closer look at the test model GMC Acadia parked in my driveway. It was exactly like the one she had spec'd out on the Internet, right down to its candy-apple red paint.

The Acadia is the second member of a family of new crossovers, featuring three rows of seats, from General Motors. Saturn was first with the Outlook. Buick’s Enclave comes on stream soon.

I’m betting the Acadia, generating some buzz already, will be the sleeper of the trio -– from the sleeper GM division. GMC has been a roaring but completely overlooked success story for the past decade. Last year, GMC and Saturn were the only two domestic brands to show year-over-year sales increases.

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Ford Fast-Tracks Diesel Engine

Ford has puts its pedal to the metal in developing the next-generation diesel engine for its F-Series Super Duty pickup truck after an ugly contract dispute and quality issues with its current diesel engine supplier, Navistar International Corp.

Sources say Ford is hustling to quickly develop its own diesel engine, which accounts for 40 percent of its F-Series pickup sales, so it doesn’t have to rely on Navistar.

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Meeting Agenda: Bush and Automakers; UAW Convention

Some important auto-related meetings are on the docket this week and worth watching.

First up, President George Bush meets again with General Motors Chairman and Chief Executive Officer Rick Wagoner, Ford CEO Alan Mulally and Chrysler CEO Tom LaSorda.

On Tuesday, 1,500 UAW delegates meet in downtown Detroit to discuss issues for upcoming negotiations. The UAW’s contract with GM, Ford and Chrysler expires in September.

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Nissan: Down but a Long Way From Out

By Peter Nunn

Suddenly, the world is jumping on Carlos Ghosn and Nissan, and with reason. The six-year bull-run engineered by the iconoclastic business champion has now hit some unexpected bumps in the road.

Profits are down, sales are down. Nissan's management is reshuffling. And analysts and editors are asking tough questions of a CEO who has known almost nothing but success since he famously brought Nissan back from its near-death experience in 1999, earning huge plaudits from around the world in the process. It's a rare rebuke for "Le Ice Breaker."

How has this Nissan fall-off happened and, more to the point, been allowed to happen? The intensity of global competition, price wars and surging raw material costs aside, you could say a lot of it has to do with product, or the lack of it.

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Magna, Private Equity Firm Bid for Chrysler, Analyst's Report

Canadian supplier Magna International Inc. has joined with a private equity group to make an offer to buy the Chrysler Group from DaimlerChrysler, according to Brett Hoselton, an analyst for KeyBanc Capital Markets, as reported by Automotive News.

Magna and its partner have made an offer to buy Chrysler for $4.6 billion to $4.7 billion, Hoselton says in his March 23 report. He cites sources at Magna but does not name the private equity partner.

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GM Trims Lucerne, DTS Production

Buick General Manager Steve Shannon told the Automotive Press Association this week that 2007 was Buick’s breakout year and boasted about the 96,000 Lucernes the General Motors division sold last year.

However, sales of the Lucerne –- along with the Cadillac DTS (formerly known as DeVille) -– have slowed to the point that GM is trimming production. The Detroit Hamtramck plant that produces the two cars will shut down next week in an effort to keep inventories from bloating due to slower sales of the cars.

Insiders worry about the long-term prospects for the Detroit plant, because of the slow sales of the vehicles it produces and no future plan outlined for the plant by GM management.

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And We Were Worried About the Chinese

While it isn’t specifically auto related, a lawsuit between U.S.-based Oracle Corp. and German-based SAP AG is worth some attention.

Oracle yesterday sued SAP for "corporate theft on a grand scale." Oracle claims its business software rival used customers' online access codes to steal copyrighted software.

Oracle, which is battling with SAP in the market for software that helps companies automate business functions, accused the German company of gaining repeated and unauthorized access to its password-protected customer support Web site.

In its lawsuit, Oracle said a "storehouse of stolen Oracle intellectual property" allowed SAP to offer cut-rate support services to Oracle customers and lure them to their own products.

U.S. and other Western companies, including automakers, have listed intellectual property theft as one of their top concerns in doing business with Chinese companies, some of which are their own partners. Now it appears intellectual property worries need to be extended to friends in Western countries as well. The outcome should be interesting to watch.

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Ford’s Truck Sales Stalled

First a legal dispute stalled Ford’s Super Duty sales; now a quality issue halts sales.

Ford ordered dealers Wednesday to stop selling its Super Duty pickup with the 6.4-liter diesel engine Wednesday and recalled the 8,400 trucks already sold. The automaker has received three reports about flames shooting out of the tailpipes.

The Super Duty, on the market for two months, is a critical vehicle for sales and profits –- it is one of Ford’s most lucrative models and the diesel version represents 40 percent of Ford’s F-Series sales. In addition, Ford is positioning the Super Duty as a halo over its full-size pickup line as Toyota launches its Tundra pickup.

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Chrysler Sale Could Be This Month or Next

The sale of Chrysler could occur soon, as early as the end of this month or next.

Chrysler CEO Tom LaSorda told a group of dealers he gathered in Florida Wednesday that a decision about a possible Chrysler sale would be made relatively soon. He didn’t give a specific date, but said the ordeal would not go another six months, dealer sources told various newspapers.

Further, The Wall Street Journal, citing unnamed sources, reports today that DaimlerChrysler expects to have preliminary offers to buy Chrysler by the end of this month from at least three bidders: private equity firm Cerberus Capital Management LLC; the private-equity tandem of Blackstone Group and Centerbridge Partners LP; and Canadian auto parts maker Magna International Inc.

An update on Chrysler’s future is expected at the DaimlerChrysler annual meeting, set for April 4 in Germany.

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York Adds His Two Cents on Chrysler

Jerome York, former Chrysler chief financial officer and former General Motors board member, added his two cents Wednesday about a potential Chrysler sale.

York said forging a solid partnership with the UAW is absolutely essential to any buyer considering the purchase of Chrysler. He said the key to a purchase hinges on the buyer’s ability to negotiate significant concessions from the union.

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Al Gore Extends an Olive Branch -- Sort of

Few politicians scare Detroit automakers more than Al Gore, but today he handed them an olive branch -– sort of.

Fresh from winning an Oscar for his global warming film, An Inconvenient Truth, Gore testified before the Democratic-controlled House today that he supports higher fuel economy standards but automakers alone shouldn't be expected to solve global warming.

“Don't single out cars and trucks," Gore said. They represent "only a slice of the problem" and not the biggest slice.

Still, the auto industry is unlikely to break out singing “What a friend we have in Al Gore” any time soon.

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Government Readies Stockman Indictment

Federal prosecutors are preparing criminal charges against former budget director David A. Stockman for incomplete disclosures and improper accounting practices he allegedly endorsed while at the helm of Michigan automotive supplier, Collins & Aikman Corp., according to today's Washington Post.

Citing unnamed government sources, the paper reports indictments could come as early as Monday, and the Security and Exchange Commission is also investigating.

Stockman, now 60, was CEO of the auto interiors supplier from 2002 until it filed Chapter 11 bankruptcy protection in 2005. Hundreds of millions of dollars have been spent to try to keep Collins & Aikman afloat since it supplies  parts to nearly every automaker. The company now is being sold in pieces in bankruptcy court. Meantime, the company, its board and former executives are being sued by bondholders and shareholders.

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President Bush Visits GM, Ford Plants

Executives of Detroit auto companies have complained –- appropriately so –- that they have not received the attention of the White House that they deserve.

Indeed, President Bush has made time to meet with the winners of the American Idol television show and award-winning athletes but has held only one brief meeting with auto company executives.

But yesterday Bush paid a personal visit to General Motors and Ford plants in the Midwest. His message to executives and plant workers: ethanol, hybrids and fuel cell vehicles will aid national security by reducing the nation’s dependence on foreign oil.

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GM’s OnStar Partners With Emergency Responders

Auto companies and medial emergency services have long envisioned a day when every motor vehicle would be equipped with devices that could immediately and automatically alert medical services of an accident so that injured victims could receive quick responses and appropriate care.

To that end, the Centers for Disease Control and Prevention (CDC) and the CDC Foundation with General Motors announced a partnership today whereby crash data from GM vehicles equipped with GM's OnStar communications system will be studied. From those studies, procedures to help emergency medical responders better and more quickly determine if a motorist needs care at a trauma center after a vehicle crash will be developed.

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Buick: “2007 Is Our Breakout Year”

Buick General Manager Steve Shannon claims, with six new models being introduced this year, “2007 is our breakout year.”

Speaking to the Automotive Press Association luncheon in Detroit on Tuesday, Shannon outlined some of Buick’s product plans for this year. Buick's headliner will be the Enclave crossover that goes into production next month and will be heavily promoted by golfing great Tiger Woods this summer.

In addition, the LaCrosse undergoes an upgrade for the 2008 model year that will be unveiled at the New York auto show in a couple weeks.

Shannon also confirmed Buick will bring back its “Super” designation, after a 50-year hiatus, on the LaCrosse and Lucerne.

But Buick, which sold more vehicles in China than it did in the U.S. last year, faces an uphill battle on its home turf. Its U.S. sales have tumbled 46 percent since 2002. And the slide continues so far this year.

“Granted, Buick has the Enclave coming to market,” says Alex Rosten, manager of pricing and market analysis for Edmunds.com’s AutoObserver. “But at the same time, Buick is dropping the Terraza and Rainier. And the LaCrosse (with high 125 days to turn -– nearly double the industry norm) and Lucerne haven’t lived up to expectations.”

(Read more...)

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Who Knew? A Test for Car Interior Air

The Chevrolet Cobalt has the healthiest interior air space of any mainstream vehicle offered in the U.S., according to the Ecology Center, an Ann Arbor, Mich., environmental group that tested the interiors of more than 200 new vehicles for toxic chemicals.

But, the center, which ranks the automobiles on a scale from 0 to 5, from lowest to highest, warns the industry’s commitment to reducing toxic chemicals inside cars is inconsistent.

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GM's Wagoner: Building a Deeper Bench

Little should be read into Monday’s announcement of management changes at General Motors. The moves are merely tweaking the new global management structure and taking into account a retirement. We can expect more tweaking and more retirements in the future.

GM announced Monday that Bo Andersson and Jim Queen were promoted to GM group vice presidents, effective April 1. Andersson will continue to lead the Global Purchasing and Supply Chain organization. Queen will remain the leader for Global Engineering. Those moves are part of GM’s efforts to create a global product development structure.

GM also announced Tom Gottschalk, the Law and Public Policy chief and a key adviser to CEO Rick Wagoner, will retire April 1. He is being replaced by a pair of executives who will split the job.

Gottschalk is 64. His retirement was first announced in June, but the company didn't assign a departure date at the time.

By all accounts, it’s hard to say no to Rick Wagoner. He has asked top lieutenants to stay on past retirement age and lured others out of retirement as the former Duke University basketball player builds a deeper management bench.

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Wal-Mart vs. Julie Roehm: Battle Grows More Sordid

The Wal-Mart situation involving former Chrysler marketing executive Julie Roehm, dismissed from the giant retailer, gets more sordid by the minute. It makes the controversy surrounding her at Chrysler look tame by comparison.

In court documents filed Monday, Wal-Mart accused Roehm and another top marketing executive (who was fired from the retailer) with having an affair while they were selecting new advertising agencies and seeking jobs from the agency they ultimately recommended to represent Wal-Mart, according to The New York Times.

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Former Chrysler Exec Heads Auto Supplier

We thought of former Chrysler President Jim Holden last fall as Chrysler struggled with many of the same problems he encountered and for which he ultimately got the boot. We wondered where and when he would reemerge, and now he has.

Holden was named non-executive chairman of Meridian Automotive Systems, Inc., the Michigan-based auto supplier announced Monday.

Holden was ousted as Chrysler CEO in November 2000 after barely a year on the job. He was blamed, amidst the turmoil of merging Daimler-Benz and Chrysler, for Chrysler’s slow sales and bloated inventories. Dieter Zetsche, now DaimlerChrysler CEO, replaced Holden.

Slow sales and bulging inventories recurred last fall, prompting speculation that current Chrysler CEO Tom LaSorda would be fired as well. Instead, Chrysler’s woes prompted DaimlerChrysler to put Chrysler on the auction block.

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Silverado -- 5; Tundra -- 4

The National Highway Traffic Safety Administration (NHTSA) has released its frontal-impact crash test ratings for the 2007 Toyota Tundra and 2007 Chevrolet Silverado full-size pickup trucks.

The score is Chevrolet Silverado -- five stars; Toyota Tundra -- four stars.

NHTSA tested the Regular and Double Cab versions of the Tundra; both achieved four stars.

NHTSA tested Regular and Extended Cab versions of the Silverado. It scored five out of five stars. (It can be assumed that the virtually identical GMC Sierra also rates five stars.)

The Silverado matches the same five-star scores previously earned by the current Ford F-150 and Dodge Ram 1500 pickups for driver and front-passenger safety in a frontal impact.

Toyota has boasted the Tundra goes head-to-head with Big Three pickups on payload and towing capacities as well as safety. It had expected five-star scores.

Four out of five stars represents an 11% to 20% chance of serious injury. A five-star rating indicates serious injury is reduced to 10% or less in a frontal crash.

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Saturn Aura Green Line: Least Expensive Hybrid

General Motors’ Saturn division announced today that, with the tax rebate, its midsize hybrid sedan is the lowest-priced hybrid on the market.

Saturn announced today that the Saturn Aura Green Line has a $1,300 tax rebate. Its Manufacturer’s Suggested Retail Price, including delivery fees, is $22,695, which makes it $195 less than the Toyota Prius. The Toyota Prius lists at $22,795. The current tax rebate is $1,575, which drops to a projected $788 in April.

The Honda Civic hybrid has a list price of $23,195; it has a $2,200 tax rebate, expected to remain the same after this month.

GM began shipping Saturn Aura Green Line models last week for arrival in dealerships in the coming days. The Saturn Aura won the 2007 North American Car of the Year award.

Edmunds.com's analysis shows there's never been a better time to buy a hybrid because of lower prices and incentives.

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VW/Porsche: What’s Next as Piech Holds All the Cards?

By Mark Bursa

If there were a king of German automaking, Dr. Ferdinand  Piech has crowned himself as such.

After much legal wrangling, Piech now essentially has control of Volkswagen as well as Porsche. He is also trying to create Europe’s biggest truckmaker by merging MAN and Scania.

At 69, Piech appears to be writing a legacy to rival that of his grandfather, Dr. Ferdinand Porsche, the man who created VW and Porsche in the first place.

But, now that Piech controls both, what’s in store for mass-market VW and highly profitable niche Porsche?

(Read more...)

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Truck Wars Heat Up

The full-size pickup truck war ratcheted up yet another notch this week with General Motors putting incentives on its newly introduced Chevrolet Silverado and GMC Sierra.

The GM truck incentives come on the heels of Toyota dealers putting spiffs on the Tundra, Ford launching a new ad campaign for the F-150 starring Dirty Jobs Mike Rowe, and Dodge increasing its advertising on the Dodge Ram.

GM is offering $1,000 cash bonus and zero-interest financing up to 36 months on all of its trucks. Previously, GM was offering $1,000 in trade assistance and financing of 4.9 to 7.9 percent depending on the term length.

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GM Admits Accounting Inadequacies

General Motors, long known as being run by reliable bean counters, has confessed the processes and people it relies upon to report financial performance are inadequate.

In the automakers annual filing with the Securities and Exchange Commission, the company said its internal controls for financial reporting are ineffective; the automaker disclosed it was the subject of SEC accounting probes. GM had to postpone announcing its 2006 financials because it was reviewing and ultimately restating the last six years of results.

Not surprising, GM’s SEC filing said the automaker needs further concessions from the UAW. The UAW’s national contract with GM, Ford and Chrysler expires in September.

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Nissan Shuffle Begins

The Nissan management shuffle, predicted by AutoObserver, has begun, as the automaker is about to announce its first annual profit decline in seven years due to its struggling domestic and North American markets.

Nissan-Renault Chief Executive Carlos Ghosn, who has declared Nissan in a “performance crisis,” will give up his duties of overseeing Nissan in North and South America April 1. He will focus instead on heading Nissan and Renault, which is also struggling. Ghosn will assume control of the company’s treasury department as well; the company has no chief financial officer.

“The priority for our new management team is to act decisively on the multiple challenges facing Nissan and to boost our overall performance in 2007,” Ghosn said in a statement. Next month, Ghosn is expected to unveil efforts to help Nissan meet its targets under its three-year plan.

But one wonders if the move is really designed to distance Ghosn, credited with saving Nissan from bankruptcy to making it one of the world’s most profitable carmakers in just a few years, from the disaster and putting in place someone else to be accountable.

(Read more...)

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GM Earnings: No Victory Yet

General Motors executives were cautious about declaring victory yet, despite the significant improvement reported yesterday in its financial results for 2006.

GM CEO Rick Wagoner said "nobody at GM is declaring victory." Added CFO Fritz Henderson, in detailing financial results to the media and analysts: "While an improvement, our results still are not at an acceptable level."

Indeed, GM’s turnaround plan is showing signs of life, but it is fragile, and challenges are formidable. GM faces major contract talks with the UAW this year. Health care costs, which will hit $4.7 billion this year, must be curbed. GM still struggles in its North American vehicle business. And it is vulnerable to losses for high-risk subprime lending by its GMAC financing unit, in which GM now owns a 49-percent stake having sold off controlling interest.

To keep sales momentum going, GM today launched an incentive program on certain Buick, Chevrolet, GMC, Pontiac and Saturn models. The program runs through April 3. It includes zero-percent financing for up to 36 months, reduced-rate financing for up to 72 months on some vehicles and a $1,000 customer rebate. GM sales surprised analysts by increasing in February, instead of decreasing.

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Is a U.S. Gas Tax Gaining Traction?

Pulitzer Prize-winning columnist Tom Friedman proposed a gasoline tax in a recent New York Times column. A few days later, a panel of economists surveyed by The Wall Street Journal said a gas tax is the best way the government can encourage development of alternative fuels. Now auto executives are hinting at it as well.

While they haven’t been screaming it from the mountain tops, some auto executives have quietly endorsed a higher gas tax, like in Europe, to encourage car buyers to purchase smaller, more fuel-efficient vehicles or alternative-fuel vehicles.

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Fuel Economy, Emissions: New Approach Needed

“We need a new approach.”

That’s what U.S. Rep. John Dingell, D-Mich., chairman of the House Energy and Commerce Committee, told reporters after yesterday’s hearings on stricter fuel economy standards, which included top executives from the Big Three and Toyota as well as UAW leadership.

Amen.

(Read more...)

Posted by at 5:46 AM under Chrysler, Commentary, News, Technology | Comments (0) | digg this | del.icio.us

Equity Firm Hires Wolfgang Bernhard

Wolfgang Bernhard, who helped turn around Chrysler five years ago, has signed an advisory contract with private equity firm, Cerberus Capital Management, in a possible Chrysler purchase, the Financial Times is reporting.

It appears as if private equity firms Blackstone Group, Centerbridge Partners LP and Cerberus have the edge in the purchase of the Chrysler Group. Financial Times speculates the addition of Bernhard to the team strengthens its hand.

Bernhard was chief operating officer at Chrysler when DaimlerChrysler CEO Dieter Zetsche was Chrysler CEO. Bernhard went to Volkswagen, from which he recently resigned.

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GM: Promises Kept; Promises To Keep

  General Motors’ string of encouraging news continued this morning as the automaker reported 2006 financial results that showed significant improvement.

Beating back rumors of imminent bankruptcy only a year ago, GM announced today it earned $950 million for the fourth quarter of 2006, only its second quarterly profit in the past two years. For all of 2006, GM still lost money, but significantly less than last year -- $2 billion compared with $10.4 billion in 2005.

The quarterly profit signals GM’s turnaround plan is beginning to work. Indeed, GM has delivered on its promises and is beginning to see the payoffs.

But there’s more work to be done. GM needs a favorable contract with the UAW. It has to lure still-wary car buyers to its brands. And it absolutely must introduce a production version of a break-through environmental vehicle like the Chevrolet Volt concept.

GM has many more promises to keep and miles to go before it sleeps.

(Read more...)

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Bad Timing for Intro of Nissan’s First Hybrid

Nissan has never been a big fan of hybrid vehicles. Nissan-Renault’s chief, Carlos Ghosn, has criticized hybrids as too low profit and not delivering significant savings to buyers.

Now, Nissan is in launch mode for its first-ever hybrid powertrain –- one on the Altima -- and timing couldn’t be worse.

Edmunds.com reports this month is the best time ever to buy a hybrid as hybrid prices are at historical lows because of incentives and supply exceeding demand. Conversely, that suggests it is a bad time for sellers of hybrids.

(Read more...)

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10.5 Million Alternative Fuel Autos on Today's Roads

On the eve of Congressional testimony on higher fuel-economy standards tomorrow, automakers kicked off National Alternative Fuel Autos Week by announcing that 10.5 million alternative fuel autos are on the nation’s roads, according to 2006 sales data from R.L. Polk and Co. 

The Polk sales figures show an unprecedented 1.5 million alternative fuel autos were sold in 2006, surpassing automakers’ sales expectations by 50 percent. Currently manufacturers offer 60 models of alternative fuel automobiles for sale. They include hybrid electric, ethanol-capable E-85, and clean diesel, up from just 12 models for sale in 2000.

Posted by at 7:14 AM under News, Technology | Comments (0) | digg this | del.icio.us

Big Four Go to Washington

Top auto executives from General Motors, Ford, DaimlerChrysler and Toyota go to Washington, D.C. tomorrow to testify on proposed higher fuel-economy standards.

GM CEO Rick Wagoner, Ford CEO Alan Mulally, Chrysler CEO Tom LaSorda and Toyota Motor Sales President Jim Press are scheduled to appear before the House Energy and Commerce subcommittee on energy and air quality.

A number of proposals to address global warming through increased fuel-economy standards and stricter emissions regulations are on the table. Predictably, the automakers will argue tomorrow that any of them will cost their industry billions of dollars.

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GM Finally To Release Financial Results

When General Motors finally releases its long-delayed financial results for the fourth quarter and all of 2006 tomorrow, the news is expected to be encouraging. The automaker is expected to report its first quarterly profit in two years.

GM confirmed in January that it would post record revenue in its auto business and a profit in the fourth quarter of 2006 for its first profitable quarter since the fourth quarter of 2004 when it made $630 million. Though the 2006 profit isn’t predicted to be enormous, it will be another sign that GM’s turnaround plan is working.

(Read more...)

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March Madness: Go Green!

Now is the time to buy a hybrid vehicle, 

according to Edmunds.com. 

Average transaction prices of most hybrids are at historical lows, incentives are being offered on many popular models, certain hybrid tax credits will be lower soon, and gas prices are rising.

(Read more...)

Posted by at 7:26 AM under Analysis, Featured, Ford, Toyota | Comments (1) | digg this | del.icio.us

Toyota Tundra Makes Inroads With its Owners

Toyota launched the Tundra pickup truck only last month, and so far, based on Edmunds.com’s analysis, it is drawing sales largely from Toyota loyalists rather than stealing sales from General Motors, Ford, Chrysler and Nissan.

Based on February sales data, Edmunds.com puts Toyota’s loyalty rate on the Tundra -- calculated based on what make vehicle was traded in for the Tundra -- at 50 percent, up dramatically from 38.3 percent the month before. That indicates Toyota owners are trading their current Toyotas -- Tundras, largely -- for the new Tundra.

(Read more...)

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Ultra Cheap Cars: “The Next Big Thing?”

Much of the buzz at the Geneva auto show was centered on small and ultra-cheap cars, particularly for emerging markets.

The talk was prompted by Renault’s unveiling of the station wagon version of its Romanian-built Dacia Logan. In addition, Renault recently announced it would build a large assembly plant in India with its partner there, Mahindra & Mahindra.

Word is Toyota has some big breakthrough regarding an ultra-small, ultra-cheap car it plans to introduce, though details are very sketchy.

Don’t count on it, says General Motors Vice Chairman Bob Lutz. Lutz believes much of the talk around ultra-cheap cars is a lot of hype, with the media dubbing them as "the next big thing." Toyota has promised other supposed breakthroughs in the past, he pointed out, but not delivered.

Yes, small, ultra-cheap cars represent significant volume opportunities for auto manufacturers in emerging markets. But, as Lutz points out, there’s no magic to making them. Indeed, GM is studying lots of options regarding how to bring to market an ultra-cheap car.

(Read more...)

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Geneva Auto Show: Zetsche Offers Tidbits on Potential Chrysler Sale

DaimlerChrysler CEO Dieter Zetsche provided a glimpse of what went on behind the scenes leading up to the Feb. 14 announcement that the German automaker is “exploring all options” in regard to Chrysler Group, including its possible sale.

Zetsche told a small group of reporters at a briefing at the Geneva Motor Show that he could not and would not comment on specific speculation and rumors regarding the possible sale of Chrysler and potential suitors, but he did confirm the following:

DaimlerChrysler and General Motors had explored how they could collaborate about nine months ago -– at GM’s instigation;

The United Auto Workers (UAW) union’s refusal to provide Chrysler with the same concessions in health care that it gave to GM and Ford played a key role in DaimlerChrysler deciding to “exploring all options,” including Chrysler’s sale;

DaimlerChrysler has spent the past 14 months considering the best option for the automaker as a whole and its individual components. Not only was the sale of Chrysler Group on the table, so was consideration of the sale of other divisions, specifically the truck group.

(Read more...)

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Opel GTC Concept: A Future Saturn?

GENEVA, Switzerland -- Picture General Motors’ Opel GTC concept car with a Saturn badge, and you’ll see a future Saturn midsize car.

On the eve of the first press day of the Geneva Motor Show, General Motors’ European subsidiary, Opel, unveiled its GTC concept car that strongly hints at the next-generation Vectra and, according to GM’s European head of design, Bryan Nesbitt, speaks a new design language for Opel in the future.

Ditto for Saturn since Saturn and Opel are closely aligned.

(Read more...)

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Geneva Motor Show: Arena for More Chrysler Speculation

As the city hosts the media for its annual motor show, Geneva, Switzerland, will provide this week’s arena for speculation on who will buy Chrysler, speculation that has turned into an international sport.

This week’s front-runners for Chrysler are said to be private equity firms. The Blackstone Group LP is generating the most buzz.

Wolfgang Bernhard, former Volkswagen and Chrysler executive, is reportedly talking with private equity firms about an advisory role to guide them in purchasing Chrysler.

The white knight scenario of the week goes to Toronto-based auto supplier, Magna International.

Analysts are warming up to a General Motors' takeover of Chrysler if it involves an equity arrangement.

The Chinese remain a long shot.

Word out of Germany is that DaimlerChrysler is considering retaining Chrysler’s family jewel, Jeep.

And who knows what else will emerge this week?

(Read more...)

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Auto Suppliers to Automakers: "Just Say No"

William Davidson is hardly a household name even in his home state of Michigan, and he’s a man of few public words so when the octogenarian billionaire, who made his fortune initially in the auto supply industry, talks, he’s worth a listen.

And his advice to other auto suppliers: Just say no to ridiculous demands by automakers.

(Read more...)

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Both Sides Now: Ashcroft and XM

Former Attorney General John Ashcroft approached XM Satellite Radio Holdings Inc., offering his consulting services. When XM declined his offer, Ashcroft was hired by the National Association of Broadcasters to fiercely oppose an XM merger with competitor Sirius Satellite Radio Inc., according to The Wall Street Journal Sunday.

The paper reported Ashcroft approached XM in the days after the merger to offer his consulting services. XM declined. He was then hired by the broadcasters association. Last week, Ashcroft sent a letter to his successor, Attorney General Alberto Gonzales, blasting the proposed merger, citing negative impact on competition.

Proving once again, money talks.

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Personnel News: Where Are They Now?

Former Ford Engineer Goes to Johnson Controls

Mary Ann Wright, who headed the team that launched the Ford Escape Hybrid, has joined auto supplier Johnson Controls as CEO of Johnson Controls-Saft Advanced Power Solutions LLC, a joint venture between Johnson Controls and French battery maker Saft Groupe SA.

Luring Wright to Johnson Controls, headquartered in Milwaukee but with major operations in Detroit, is a coup. She’s the real deal, according to everyone who worked with her inside Ford.

In her new job, Wright will be responsible for accelerating the growth and executing the launch of hybrid, plug-in hybrid and electric vehicle battery programs with emphasis on state-of-the-art technology, manufacturing and electronics integration, her new employer said in a statement. In addition to leading the joint venture, Wright will also have the role of vice president and general manager, Johnson Control's hybrid systems. 

(Read more...)

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Ford Rewards Mulally for Progress

Ford has boosted the compensation package of CEO Alan Mulally, who has been on the job six months, by giving him another $1 million in stock options, putting the total at $6 million, and giving his family corporate aircraft privileges, even if he is not on board.

Noted in Ford’s annual report filed with the U.S. Securities and Exchange Commission Thursday, Ford’s board approved the pay package enhancements saying Mulally’s “leadership role in progressing his key priorities.”

Only a week ago, Ford’s President of the Americas Mark Fields informed employees the automaker is missing key targets. Fields gave up his use of the Ford corporate jet for his weekend flights home to Florida, after the media reports made it public.   

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Ford Job Opening; Deja Vu

Ford reportedly has hired an international headhunting firm to find an executive to fill the new post of global marketing director –- again.

This is not the first time Ford has gone through this exercise. A couple years ago it did the same thing, recruited candidates, put them through the interview process, narrowed the field to some finalists -– and then hired no one with no explanation given for its inaction.

Maybe with CEO Alan Mulally at the helm, someone will actually be hired.

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Ford Expands Challenge Campaign

Ford is extending its Fusion Challenge marketing effort to include not only its midsi