The Truth About Cars » Industry

Editorial: Sergio Marchionne: Savior or False Prophet?

John Horner — Fri, 13 Nov 2009 18:27:33 +0000

Not long after Fortune’s long time auto writer Alex Taylor III finished his apology to Ford he went on to write a love letter to Sergio Marchionne. Taylor starts with parallels to Ghosn’s myth making success at Nissan, then ups the ante: “The other day in Auburn Hills, Mich., Fiat CEO Sergio Marchionne took a [...]

Editorial: Opel, Aftermath and Prelude

Bertel Schmitt — Thu, 05 Nov 2009 14:09:20 +0000

On Tuesday, twenty years after the fall of the wall that separated the two Germanies, German Chancellor Angela Merkel went to Washington. For the first time since Germany’s Chancellor Adenauer in 1957, the topmost German addressed Congress—to roaring applause. There was another wall. A wall of silence. Nobody in the US government—owner of General Motors—supposedly had [...]

Editorial: The Carless Kids

Edward Niedermeyer — Sun, 25 Oct 2009 21:27:49 +0000

We’ve seen the signs coming for some time: rumors from Japan, declining car sales at home, advertisments selling cars as “the ultimate mobile device.” And the picture that’s beginning to reveal itself is a challenging one for fans of four-wheeled transport. Young people, once a deep well of enthusiasm and sales growth for the car [...]

Ford 1979 vs. Ford 2009: What’s Changed?

admin — Sat, 03 Oct 2009 18:04:10 +0000

So exactly how did Ford achieve quality equal to Toyota? Or are their TV ads misleading, as the ads from decades ago which proclaimed “At Ford Quality Is Job One”? This was the question in my mind as I returned to the Sharonville Transmission Plant after exactly 30 years. A long term friend, who did not jump ship in 1979 as I had done, when it looked like Ford was going to self destruct, got me past the guard post for a tour of the plant. Jerry had seen what he called “a compete transformation of Ford Motor Company” during his 37 years. He said I would not recognize the place.

Make Cars Not Trade Wars

Andrew van der Stock — Thu, 17 Sep 2009 16:43:13 +0000

Your car is made up of thousands of components, manufactured all over the world and assembled in many places by humans and robots. There is simply no such thing as a 100% “domestic” car anywhere in the world. When (not if) artificial barriers are placed on the manufacture, sale and movement of parts and the eventual manufacture, sale and movement of the resulting vehicle, there are two common outcomes. The best-case scenario is you’re going to pay more---effectively stealing from you and everyone in the global economy. Unfortunately, the typical result is that you cannot buy most of the cars made on this planet in your local market.

Editorial: Luxury Carmakers Hoisted by Their Own Petard

Robert Farago — Thu, 27 Aug 2009 04:16:04 +0000

Thanks to Uncle Sam's Cash for Clunkers program, even the weakest of America's mainstream automakers will live to die another day. Meanwhile, the so-called "mass luxury" brands are hurtin' for certain. The falling tide of the global economic meltdown has left Audi, BMW, Cadillac, Lexus and Mercedes stranded, flopping around on the metaphorical beach, gasping for the oxygen of financial lubricity. It's hard to feel sorry for any of them. The upmarket marques marked the last ten years or so by chasing volume sales with "entry level" models that cheapened and weakened their brands. Is it any surprise that the very customers that fueled their expansive profits have abandoned them in droves, as badge snobbery has kept pace with financial security (or lack thereof)? In other words, the fact that these "luxury" brands are "suddenly" in worse trouble than everyone else is their own damn fault.

Editorial: How GM Tried to Win Me Over, Part Three

Darwin Hatheway — Tue, 18 Aug 2009 05:46:32 +0000

While driving the Buick LaCrosse, I asked Line Director Jeanne Merchant a question: what could she tell me about reliability that would persuade me, a satisfied Toyota owner, to jump ship? Merchant gave a pretty good answer, but I was busy trying not to run over traffic cones. In a subsequent phone interview, Merchant said reliability starts early in the process. From design to component testing, from durability tests to audits and feedback, from computer modeling to real world testing, they make sure every part of the car and all its systems are built right and performing to specification. And they take it very, very seriously. “The LaCrosse is very personal to me," Merchant said. "I’ve worked with it for years. Everybody else involved feels the same way. And the same goes for the other product lines.” Process and passion. Is it enough?

Editorial: How GM Tried to Win Me Over, Part One

Darwin Hatheway — Fri, 14 Aug 2009 17:35:12 +0000

A few weeks ago, I received this from GM Communications: "I've noticed some of your comments on our Fastlane blog. We are looking for passionate and influential consumers to participate in an upcoming showcase on August 10, 2010 in Detroit, MI. Would you be interested in a GM-hosted opportunity like this to learn more about our future vehicles and company?" I was more than a little surprised; my FastLane posts are generally uncomplimentary regarding GM's products and business decisions. “Do they know we own three Toyotas?" my wife asked. "And we gave a fourth to our daughter, who’s happily driving it at 150 thousand miles?” “I think that’s part of it; they want to know what it will take to win me over.” “They could try building cars that are as reliable as Toyotas.” “I’ve suggested that.” “Don’t you dare bring home a GM car," she warned.

Editorial: Why I Hate Cash for Clunkers

Michael Martineck — Wed, 12 Aug 2009 00:26:02 +0000

The CAR Allowance Rebate System---C.A.R.S---sounds like a ‘70s Saturday morning cartoon about guys in striped jackets using trick vehicles to save the world. In fact, that would actually be preferable to the program currently airing, at cost of three billion and counting. Cash for Clunkers may be popular with a healthy segment of the population, but that group doesn’t include a lot of economists. In terms of economic policy, C4C would benefit from a little C4, if you know what I’m sayin’.

“Cars for Comrades: The Life of the Soviet Automobile”

Lewis Siegelbaum — Wed, 05 Aug 2009 13:29:52 +0000

I set out to write a book not so much about the varieties and comparative deficiencies of cars in the Soviet Union as what these objects meant to Soviet citizens. The structure and organizing principles of the book were among the first things to become clear. There would be three chapters on the “Soviet Detroits”---the places where automobiles were built, the people who built them, and how the cars and trucks they produced both embodied the state's agendas and inspired popular identification.

Editorial: Chrysler Destroys Its Historical Archives; GM to Follow?

Bob Elton — Mon, 27 Jul 2009 01:10:12 +0000

Archives are the foundation of historical research. Without access to primary material---be it documents, photographs, financial statements, engineering or test reports---historians lack the building blocks necessary to write the chronicles that inform our understanding of the past and illuminate the future. To their credit, America's automakers have gone to great lengths and expense to preserve and protect the historical documents which chronicle and define their existence. Until recently. As Chrysler and GM plunged into bankruptcy, they turned their back on their own heritage, and destroyed a priceless part of our collective past.

Toyota to Leave the North American Market?

menno — Thu, 23 Jul 2009 01:04:40 +0000

Toyota is the top automaker in the world, and has grown to this point by using methods put into place by one lone individual crying in the American post-war industrial wilderness. His name was Deming, and his message was (paraphrasing) “make it right the first time and it’ll be less expensive, better for the customer and more profitable for the manufacturer.” He also laid out how best to continually improve. The Japanese took this message and ran with it, patiently decimating the competition over half a century.

Editorial: The Truth About Rare Earths and Hybrids

Robert Farago — Wed, 22 Jul 2009 12:13:16 +0000

There’s no doubt about it: the automotive landscape is changing. Carmakers around the globe are embracing electric propulsion, whether the volts are generated by a gasoline motor, a fuel cell, a distant power plant or a combination thereof. New companies seem to be springing up overnight to take advantage of the government’s desire (and money) to wean motorists from their petrochemical "addiction." While everyone is rushing to produce politically-correct powerplants, one fundamental question that remains largely unexamined: from where will manufacturers secure the raw materials needed to mass produce this new technology?

Editorial (Conspiracy Edition): Opel, RHJ, GM, Bilderberg, Rattner and Black Helicopters

Bertel Schmitt — Fri, 17 Jul 2009 14:16:17 +0000

Last night, make that early in the morning here in Beijing, I received a pleasant phone call. The lady identified herself as working for a large and reputable German newspaper. We exchanged German pleasantries, as much as they exist. Then she said: "You wrote about RHJ, Ripplewood and Opel? Do you know anything about Tim Collins' connections?" I confessed that I know of a recording artist named Collins, but his first name is Phil. "TIM Collins, the owner of Ripplewood," she said. "Sorry, never met the guy" was my answer. She says: "Ok, maybe I have to dig around his old compatriots myself." With these words, she bid me ta-ta. Are you the type who is worried of black helicopters? The New World Order? The Trilateral Commission? The Bilderbergers? Then read on. If you think conspiracies are bunk, skip to the next post.

Editorial: “Ten Most Unfortunate Car Names”

Robert Farago — Tue, 14 Jul 2009 16:43:48 +0000

Glenn sent us a link to this list on oddee.com. And the winners are: 10. AMC Gremlin - Wikipedia: "Gremlin is an English folkloric creature, commonly depicted as mischievous and mechanically oriented, with a specific interest in aircraft. Although their origin is found in myths among airmen, claiming that the gremlins were responsible for sabotaging aircraft, John W. Hazen states that 'some people' derive the name from the Old English word gremian, 'to vex'. Since World War II, different fantastical creatures have been referred to as gremlins, bearing varying degrees of resemblance to the originals." Such as . . . Howie Mandel. The AMC Gremlin wasn't known as much for mechanical malfunctions as its questionable styling. That said the name didn't stop 671,475 American and Canadian customers from buying one. Well, I assume it was one.

Editorial: Imagine a world where Steve Rattner decides that Ken Elias should become the anointed King of GM

Ken Elias — Mon, 13 Jul 2009 14:50:35 +0000

That’s right, the CEO in charge of Government Motors. (Ok, don’t really ask me why I think I’m qualified; let’s just suspend belief for a few minutes shall we?) So what would I do? First, I’d insist on a new wardrobe for every person at every level. Gone are all the suits for the white-collar workers. Factory workers can’t wear jeans and t-shirts or whatever. Nope, everyone in the company now wears the GM uniform, kind of like the military. The new GM garb consists of coveralls in blue and white with a GM logo on the back, and each worker gets a name tag to pin on the front. Ranks are determined by stripes, bars, and stars, just like the Army. As CEO, I get four stars on the shoulder epaulets. And of course, there’d be a “dress uniform” for outside events.

Editorial: GM Chapter 7?

Jehovah Johnson — Mon, 29 Jun 2009 12:49:32 +0000

The most definitive difference between Chrysler’s swift conversion from Old to New Chrysler and the General’s "reinvention": the element of surprise. Or lack thereof. The General's list of creditors on GM’s court filing (dealers, parts manufactures, advertising media, bondholders, et al.) are all painfully aware of what happens when "The Fix" is in. They now know what it means when The President of the United States promises the public that “we will get this done in a swift and expeditious manner." Forewarned is forearmed. And there's another crucial difference between Fiatsler's transformation and the plans for Government Motors: the GM dealer body is a wealthier, more connected group of businessmen than the Chrysler dealer body. In other words, "Old" GM may not go so quietly into that good night.

Editorial: Volkswagen’s Piech Blackmails Porsche’s Wiedeking: Deal by Monday or Die

Bertel Schmitt — Sun, 28 Jun 2009 08:37:17 +0000

A week ago, we predicted that Volkswagen, buoyed by stellar numbers, would soon swat nuisance Wiedeking once and for all. It didn't take long. Ferdinand Piech, chairman of the supervisory board of Volkswagen and co-owner of Porsche, pulled out a big gun and put it to the head of Wendelin Wiedeking, CEO of Porsche (and theoretically Piech's employee). Piech said (we are paraphrasing in the interest of brevity): "Say uncle by Monday. Or you're dead." Nice family.

Editorial: Piech vs. Wiedeking—Leaks, Letters, Lies and the Triple Witching Hour

Bertel Schmitt — Fri, 19 Jun 2009 08:35:44 +0000

Assume for a horrifying second that you are the chairman of the board of one of the world's largest auto companies. You also own large chunks of a smaller auto maker. Your executive assistant brings in a letter from one of the top managers of that smaller automaker. The letter says you broke the law, you hurt the company, and he may hold you personally liable for the damage. To the tune of, oh, several billions. Euros. What would you do? Right. Send down security with a moving box and have the guy escorted to the factory gates. Ferdinand Piech, chairman of the board of Volkswagen, supervisory board member of Porsche, and one of the largest owners of Porsche received such a letter from Porsche CEO Wendelin Wiedeking. The letter arrived a month ago. Wiedeking still has a job. But the letter has been leaked to the press. The day before Wiedeking's day of reckoning.

Editorial: Connect the Dots: Could GM Get Their Own Version of the Prius?

Frank Williams — Thu, 18 Jun 2009 23:44:36 +0000

GM is shutting down production of the Pontiac Vibe at the New United Motor Manufacturing, Inc. (NUMMI) plant in California. GM has sold some car or another based on the Corolla ever since they jointly opened the plant with Toyota. GM doesn't need them to produce another small car, as they're looking at plants in Michigan, Wisconsin and Tennessee for that. That's the first dot. And away we go!

Editorial: GM/Chrysler Dealer Cull Explained. Ish.

Jim Brennan — Thu, 18 Jun 2009 03:05:46 +0000

The automotive retail landscape has been dramatically reshaped as both Chrysler and GM together have terminated almost 2,000 dealers as part of their on-going restructuring efforts. They were able to use the bankruptcy process to circumvent strong state franchise laws to shed dealers. At times there appeared to be no rhyme or reason to the selection process, leaving both dealers and consumers perplexed. Last week, as new details and documents surfaced on thetruthaboutcars.com on why certain GM dealership agreements would not be renewed in 2010, Automotive Traveler took an in-depth look at the closing process.

Editorial: What Would Deng Xiaoping Do?

Bertel Schmitt — Wed, 17 Jun 2009 09:07:56 +0000

China is becoming the new America, while America is becoming the old China. Jack Perkowski thinks it's happening right now. Jack is an Old China Hand and a colleague in the automotive parts business. He's an American, and a Yale graduate. 15 years ago, he came to China and started ASIMCO, an auto component manufacturing company. In January, Perkowski left the company. The global decline in the business didn't spare ASIMCO. Perkowski is a true Lao Wai, which literally translates into "Old Foreigner" in Mandarin. From one of the first in China, we inherited a lot of his experience. Some is chronicled in Perkowski's book Managing the Dragon, which made the best seller lists. Most is regularly updated in Perkowski's blog that goes by the same name. In a recent post, he left us some interesting thoughts. Some may find them revolting, even seditious.

Editorial: Boycott the GM Boycott

William C Montgomery — Thu, 11 Jun 2009 16:43:34 +0000

In recent months we have seen the Obama administration nationalize the majority of the domestic automobile industry. A recent poll indicates that a decisive majority of Americans think this is a really, really bad idea. Furthermore, the action is illegal. The Constitution of the United States of America has endowed the congressional branch of the government with the sole power to spend money. Article 1, Section 9: “No money shall be drawn from the treasury, but in consequence of appropriations made by law [i.e. by the legislative branch].” This makes the financial seizure of General Motors with money appropriated by congress for the use of stabilize the banking system a brazen act of embezzlement. (The witless leader of the House of Representatives says that King Obama has not requested that they pass legislation authorizing expenditures to GM and Chrysler, so it must not be needed.) And so there has been cry among some right wing bombasts to boycott the purchase of GM cars. This too is a bad idea.

Editorial: Treasury Secretary Tim Geithner in China for GM’s C11

Bertel Schmitt — Mon, 01 Jun 2009 10:10:39 +0000

US SecTreas Timothy Geithner quickly got out of DC for the Monday curtain call of the artist now known as Government Motors. Geithner went as far as Beijing to distance himself from the performance. Keeping a distance didn't mean keeping his mouth shut. From Chrysler and GM, "we want a quick, clean exit as soon as conditions permit," Geithner told students at Peking University in Beijing. Reuters took notes. "We're very optimistic these firms will emerge from restructuring without further government assistance." Strangely, everybody shares his optimism . . .

Editorial: Opel Watch: A Deal, But Not a Contract

Bertel Schmitt — Sat, 30 May 2009 06:53:06 +0000

It was a long night again. Not as long as the disastrous Wednesday/Thursday meeting. And it didn't end in invectives. At 2:15 in the morning, Finance Minister Peer Steinbrück stepped outside Chancellor Angela Merkel's offices and reported: "I can tell you that a deal has been reached." If you looked hard enough, you could see holy white smoke rising into Berlin's night sky.