When I started as a budding (and driver’s license less) copywriter on the Volkswagen account in fall of 1973, they were just introducing a (for Volkswagen) highly unusual car. They called it the Passat. After that followed in rapid-fire fashion the Golf, the Scirocco, the Polo. They turned the company around. And kept me employed for more than 30 years. With the Golf being the volume Weltmeisterr, it is often forgotten that it was the Passat that started a new era at Volkswagen. And now, the car enters its 7th generation. Read More >
Category: Paris Auto Show
When Alan Mulally took over at Ford and sold off Jaguar and Volvo, a few people (me included) wondered as follows:
Having “Ford” as a global brand is well enough, but how will they compete in the more profitable luxury market? Read More >
We have met the Obamamobile, and it is a train. Just ask Commerce Secretary Gary Locke. Locke was in Michigan recently, while SecTrans Ray LaHood, VP Joe Biden and MI Governor Jennifer Granholm were discussing a Detroit-Pontiac-Chicago high-speed rail line in Washington, D.C. The HuffPo‘s Susan Demas asked Locke if he saw the rail project as a way to wean Michigan’s manufacturing base off its centuries-long auto addiction. To which Locke replied, “Oh, yeah,” faster than the Kool-Aid man after a post-college Eurorail adventure. “As you see more construction of rail cars, high-speed cars, it’s going to require new engineering, new products and services and that’s the natural fit and extension for automotive dealers and suppliers and manufacturers.” And Demas agrees, arguing that “linking up with rail makes perfect sense for a contracting industry, at a time when environmental and economic factors make expanding public transit a necessity.” Yes, necessity. As in the mother of invention. And political intervention.
Demas does point out that the rail project in question could face political opposition. “It will take a real will on the part of the states and the Congress to get it done,” she quotes former Rep Joe Schwarz (R-MI) as saying. “Members of Congress from non-high-speed rail states will fight it.” Meanwhile, the self-serving dynamic identified by Schwarz illustrates a major problem with the US rail industry, and how (car-to-train transition aside), the US ownership of GM could make it a political pawn at every turn.
Over at The Daily Beast, former GM and Amtrak man James Langenfeld recounts how the publicly-owned rail firm has become a perennial victim of DC’s politics-before-economics. “Amtrak had a government-affairs department rather than a finance department,” he writes. This “proved to be an omen: Train service was provided to states with powerful senators, even if this involved huge losses and few passengers.” A preview of coming factory placements? Meanwhile, at “38 years old and [showing] no sign of moving out of the taxpayer’s house,” Amtrak subsidies are currently $85,000 a year for each employee, or about $35 every time Amtrak sells per ticket sold. In the absence of profitability, Amtrak and now GM merely provide another opportunity to send pork home to the district.
And Langenfeld isn’t the only one who sees parallels between Amtrak and the new Government Motors. “I see no hope whatsoever for the situation,” says Wendell Cox, who served as a policy consultant for the government-appointed Amtrak Reform Council a decade ago. Cox tells Fox News that political considerations have led to poor decisions at Amtrak, “like maintaining costly, long-distance lines and setting up inefficient routes that detour through low-population areas.”
Even among those who support the bailout and improvements to America’s rail system, there should be concern about any mention of the auto and rail industries in the same breath. After all, the government’s open-ended commitment to GM is sure to become a focal point for political opposition to the Obama administration. And for those who are already disposed towards criticism of Obama, Amtrak is a preeminent symbol of government mismanagement. From George Will to the National Review‘s K-Lo to Ron Paul, GM-as-Amtrak is becoming the meme of choice for the emerging anti-auto-bailout mainstream. Anyone who thinks GM won’t be held hostage to political battles clearly has another think coming.
And though Amtrak has the excuse that rail industries are typically subsidized by governments, GM can’t fall back on the “everyone’s doing it” argument. Meanwhile, suggesting that the auto industry should look to yet another government-stimulated sector as a way forward provides further incentives to accept mediocrity in its automotive products. All of which illustrates how slippery the bailout slope really is. Remember, the bailout has been justified since day one with rhetoric about the unique role of the automobile industry in American life. If there’s any possibility for hope in the emerging American Leyland, it comes from the ability to invest huge amounts of money at a time when the auto industry is going through a period of transformative change. Rail business is a distraction at best, and a life sentence of government angency-dom at worst.
Locke’s talk of “transitioning” the auto industry towards rail shows exactly how far politics could go towards affecting the future of the new Government Motors. And without a clear exit strategy, there’s no telling where it could end. There’s nothing inherently wrong with more rail transportation in the US, but painting the rail biz as an alternative for a struggling US auto industry ignores the ugly reality of public Amtrak ownership. As badly as GM has done building cars for several decades, it will either exit Uncle Sam’s nest on the strength of its cars or face a downward spiral into political adventurism to which there is no bottom. In the case of the latter scenario, the last 30 years of GM’s decline will look like the work of true genius.
I say Caruthers, what’s all this hoo-ha about the Arnage? That Whitcombe chap at Classic Driver said something about them not making it any more. That is correct sir. Well why the Devil not? Regulations sir. Damn those Belgian swine! Consider them damned sir. What’s that? Yes. Exactly. So, should we trade in the old girl? What’s this one got that mine hasn’t? All the power of the Arnage T with the luxury of the R, sir. Two cars for the price of one. Clever. Tell me more. Well, speaking from memory, the Final Series offers hand-made waistrails with inset chrome strip, bearing recessed Bentley badges, of course. Yes, yes. Of course. Go on. A new rear cocktail cabinet and document storage trimmed in hide, and picnic tables available in a choice of three unbleached wood veneers. Waistrails eh? I had a cousin who was a waistrel. Very amusing sir. Anything else I should know? Let’s see… I believe it has twenty-inch five-spoke, two-piece alloy wheels and ‘Le Mans’ lower front wing air vents, body-coloured front and rear lamp bezels, ‘jewel’ fuel filler cap and ‘Final Series’ wing badges and polished stainless steel front door treadplates. Do I have to ask the price? If you do sir, you can’t afford it. Can I? No sir. The stock market is a little… unsettled lately. Stuff and nonsense. My money’s safe as houses! Just so sir. Just so.
So there I was, browsing a Bloomberg (three terms or bust!) story about automakers fessing-up to the fact that electric vehicles must take a back seat to “normal” fuel-efficient small cars– which is a pretty good piece of Parisian bloggage in and of itself– when BANG! I run smack dab into a quote from the highest paid auto exec on planet Earth: Porsche SE Chief Wendelin Wiedeking. “Do you believe people will actually switch to smaller cars?” Wendy asked, in the midst of discussing Porsche’s yet-to-unveiled fuel-sucking four-door. Uh, yes? Nein! “This car fits into these times,” Wiedeking insisted. “You should go on a journey in a small car with your four-person family. What will happen is you will have had enough when you get to the border after a couple of kilometers.” Hmmm. Why is Wendy dreaming of heading for the border? Of course, by “people” Wendy means the same sort of customer GM Car Czar Bob Lutz referred to when confronted by the fuel-suckage of the then-new GMT900 SUVs (i.e. rich people don’t care about the price of gas). Meanwhile, back in the world of mass motoring, GM Europe Prez dismissed the impact of his company’s Hail Mary plug-in hybrid Volt: “The ordinary guy has to be able to afford these technologies, and the technology in the beginning will be quite expensive.” Toyota, for some reason, gets the last word. “The Japanese company’s executive vice president for strategy, Mitsuo Kinoshita, was more blunt about a world without low-emission technologies that supplant gasoline. In that scenario, ‘There is no future for automobiles.’”
I’m in the minority. While I think the Ferrari California is not only ugly, but unfaithful to the priceless Ferrari brand, others do not. Some of us shower regularly. Others like this Ferrari California. Where I see a competition with the Mercedes SL for buyers, others see some kind of gorgeous and practical roadster. How many others? Enough that the California is sold out until 2011. That’s not a surprise; every Ferrari model sells out. But what is surprising is that 60% of California buyers will be new to the Ferrari brand. And what do you bet those folks won’t be repeat customers?
TTAC’s Martin Schwoerer, attending the show in Paris, writes:
If for no other reason, the Ferrari California would have made it worthwhile to come to Paris. In the flesh, it looks absolutely stunning. I was prepared to criticize the retro, Ferrari-heritage inspired style, but it works out fantastically. Andrea Pininfarina, before you left this world, you made it a bit more beautiful.
Now that Ford CEO Alan Mulally has written-off the chances of an auto industry sales receovery for 2009, his Detroit brethren have decided to join the Greek chorus bemoaning their fate. Bloomberg caught up with former Toyota and current Chrysler Prez Jim Press in Paris to hear the bad news. “I don’t see any `whys’ why it’s going to be any better,” Press announced. “We’re already adjusting to this level pretty well. We’re learning how to fight through it. It’s hand-to-hand combat. It’s tough.” Especially if you don’t have a golden parachute strapped to your back. GM’s Fritz Henderson, also not staying at a Timhotel, was slightly less pessimistic about the year ahead. “Even if [the $700b federal bailout plan] does pass, I still think that ’09 will be weaker,” the COO told Business Week. “I don’t see anything which would suggest that you’d see a significant rebound, at least in the first half.” And then Fritz says some scary ass shit. “If the situation deteriorates further, we’ll have to look at further actions, but we don’t have anything planned today.” And… “Henderson said GM’s liquidity plan was based on a forecast of industrywide U.S. car sales of 14 million this year and next. ‘At the time we felt that was a conservative level. Given what’s happened, I’m glad we chose a conservative level because that could well be the level it lands at.’ Uh, Dude, we’re looking at sales WELL under 13m, maybe closer to 12. To paraphrase Sweet Pete, that’s a spittoon full of not good.
Oh man, this is getting ugly. After Porsche’s Turbo and GT2 lost their fastest ’round the ‘Ring record to the Nissan GT-R, the German automaker was… skeptical. So they bought a GT-R in the U.S. and ran the Nürburgring to verify their Japanese rival’s claim. And so they didn’t, failing to get within 25 seconds of GT-R’s ‘Ring highly hyped lap time. Porsche attributed the GT-R’s triumph to non-standard tires, which would nullify the Nissan’s “fastest production car” lap record. Cornered at the Paris Auto Show, Nissan’s European spokesman Neil Reeve said “Quite simply we’re not going to get into a war of words with Porsche.” And then did exactly that. “The final word from us is that it was done on absolutely standard tyres which are available to customers in the showroom. They’re not trick tyres – absolutely standard tyres, normal road tyres. The GT-R comes with Bridgestone and Goodyear (Dunlop). One tyre gives slightly better times around the ‘Ring. We did it on Dunlop. They’re available with the car.” When car.com.au‘s Andrew Heasley pushed him for an explanation, well, read between the lines. “We absolutely maintain (that) Tochio Suzuki – the chief test driver on the GT-R program pounded thousands of laps – he got to know every inch of Nurburgring (circuit) and how the car performs on the Nurburgring and hence set that fabulous lap. More than that, I can’t speculate. I can’t explain why they couldn’t match the time.”