While America Slept. Thursday, December 4, 2008

while america slept thursday december 4 2008
Neither rain,nor sleet,nor gloom of night, our daily round-up of the news that happened in other continents and time-zones must go through. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off. Note: I’m in Germany on business and will post as time allows. Last night’s news kept me sleepless, so you get WAS on time.

GM and Chrysler ready for ultimate sacrifice. GM and Chrysler executives are considering accepting a pre-arranged bankruptcy as the last-resort price of getting a multibillion-dollar government bailout, says Bloomberg. “Staff for three members of Congress have asked restructuring experts if a pre- arranged bankruptcy – negotiated with workers, creditors and lenders – could be used to reorganize the industry without liquidation.” Bloomberg quotes Lynn LoPucki, who teaches bankruptcy law at Harvard: “The Democrats’ goal of preserving a U.S. auto industry is not doable without a bankruptcy.”

China mulls GM’s default consequences: The Chinese government is also beginning to think aloud about the consequences of a possible GM default. Gasgoo quotes Xu Changming, Director of Information Resources Department under China’s State Information Center. He feels, not surprisingly, that “if a global company failed in management in its headquarters, impact will be felt by its Chinese business.” According to the Chinese, Chapter 11 would “have limited effects on Shanghai GM. The technical center built by GM and its partner SAIC will be running as usual.” However, if GM would go C7 “then Shanghai GM couldn’t produce Cadillac, Buick and Chevrolet and GM is likely to sell their 50% share in its Chinese JV.”

Volvo China unfazed, hopes for Chinese buyer: Gasgoo quotes a source at Volvo China that said that production of Volvo cars at the Chongqing plant will not be affected by the possible sale of the brand by its US parent. “Volvo Car’s Chinese partner, Changan Ford Mazda Automobile (CFMA) will start production of Volvo S80 next year, and this plan is unlikely to be affected by the change,” says Gasgoo. They also felt compelled reiterating that Bloomberg had said that an industry insider had said that Chinese automakers are among possible bidders for Volvo. Gotta read between the lines in China. And if that’s not enough …

Saab (still) CEO wants government as a buyer. The Swedish government should temporarily buy a stake in Saab, Jan-Ake Jonsson, the (current) head of the Swedish automaker told Dow Jones Newswires via CNN Money. “Fat chance” (or more polite Swedish words to that effect) said Sweden’s Industry Minister Maud Olofsson. She does not foresee Sweden taking over, or buying a stake in either Saab or Volvo.

China’s car imports way up. From January to October, China imported more than 340,000 completed vehicles and chassis, up 39.7 percent, says Gasgoo. They aren’t importing cheapos: The total import value reached $12.7b, a 51.5 percent increase from a year earlier. Sales of Mercedes-Benz S series in the first ten months surged by 50% to 12,000 units, which made China the largest market for Mercedes-Benz S series in the world. Nissan’s Infiniti saw sales up 100 percent up in China.

Nissan China way up: , a JV between China’s Dongfeng Motor Corp. and Nissan, sold 276,891 in the first then month of 2008, up 27.39 percent Gasgoo reports, citing sources at the factory. The sales volume makes Dongfeng Nissan #6 in China’s auto industry.

The East sees red: China’s November passenger vehicle sales fell about 15 percent from one year earlier, says Gasgoo, quoting a research report of Nomura International. The drop was the second biggest year-on-year monthly plunge in the past four years. China, the world’s second-largest auto market, is expected to face difficulties in the first few months of next year, the report says.

Gloom reaches Porsche. Porsche predicts “seriously lower sales” for the current fiscal year which ends on July 31, 2009. This according to their Director of Sales, Klaus Berning. Automobilwoche (sub) has details. Klaus is unable to make “a serious prediction,” but the matter sounds serious enough. Lower prices? Incentives? Not at Porsche. Remember, they are a bank with a small subsidiary that makes cars.

Loans? How un-American: Even in this cash-constrained environment. Nissan raised $475m through asset-backed securities in the local market for the first time in roughly six months, says the Nikkei (sub.) The securities are backed by Nissan Motor Acceptance Corp. The securities obtained a preliminary AAA rating from Standard & Poor’s. We usually wouldn’t mention stuff like that, but suddenly, this is news …

Your plug-in gets greener: Toshiba has developed a system that can capture carbon dioxide generated at coal-fired power plants, the Nikkei (sub) reports. A test plant will begin operating in August. The pilot plant is designed to capture 10 tons of CO2 a day from boiler flue gas using chemicals. If someone develops batteries that are affordable and not a nightmare to dispose off, the plug-in’s future will be green

German government wants their veggie diesel: Their consultants told them to go the plug-in route, but German Minister of the Environment, Sigmar Gabriel, sees veggie diesel as the solution to make car owners and farmers happy, and (unsaid, but intended) make the power plant lobby unhappy. The power planters are already talking about building new nuclear stuff, which is unpopular amongst the green contingent. Automobilwoche (sub) has more.

COA makes dire predictions: The German Center Of Automotive (COA) has polished their crystal ball, says Das Autohaus. What they see doesn’t surprise even the most casual B&B. For 2009, they predict lower sales in NA, Western Europe and Japan to the tune of 5 percent. In the BRIC states (Brazil, Russia, India, China) they see slower growth or flat sales for 2009. They see the worldwide market of 2008 come in at 10 percent less than 2007. As the winner of the crisis, they see Volkswagen, as biggest losers they see GM, Ford, and Chrysler. Details (in German) here. Let’s hope nobody pays them for these predictions, as they come at no charge and timelier at TTAC.

Other body experience: Swedish researchers found a method to manipulate the human mind to create the perception of having another body, Reuter’s reports. According to reliable sources close to the matter who requested anonymity, the method will be used during the Washington hearings. There, the researchers will trick Richard Wagoner into thinking he’s Richard Nixon. He will say “I am not a crook,” wave, climb into a helicopter, and leave. He will be replaced by Ford.

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  • Robert Schwartz Robert Schwartz on Dec 04, 2008

    KixStart: Lynn is teaching at Harvard Law School which educates graduate students in the laws of our country. He does not teach at Harvard College which educates undergraduates, nor, for that matter at Harvard Medical School which educates graduate students in medicine. Bankruptcy Law (Title 11 of the United States Code) is a normal subject for upper level law students. It is important for those law students who wish to specialize in commercial law. I know Lynn and he is good guy.

  • Alex Nigro Alex Nigro on Dec 04, 2008

    1169hp: Some dude's probably going to take a baseball bat to my poor car in a wave of anti-import xenophobia, and I don't think I can afford replacing all of my Civic's glass and caved-in body panels... And to the two above posters: don't be so sure. It could happen in the Rust Belt, the south, places where there's a higher concentration of domestics.

  • FreedMike How about the “Aztek” package? Wait, this car already has that…Said it before and I’ll say it again: they need to restyle the hind end on this car, stat.
  • Johnster "Vale" is the [s]cheap[/s] lower-priced performance version with black trim and stiff suspension."Mist" is the "DeLuxe" version with a bit more chrome and trim. (Sort of like the "Decor Package" option.)"Magentic" is the full-on Brougham treatment (in its current state) with more chrome trim than the "Mist" and all sorts of gimmicky electronic features inside. (Sadly, it will not include simulated landau irons or a vinyl covered roof, even as an option.)"Aurora" is the Oldsmobile of Cadillacs (sort of like the old Cadillac Calais). No, that's not right. It's the top-of-the-line model, sort of a "Grand Touring" version, with not as much chrome as the "Magentic" but all of the gimmicky electronic features and a stiffer suspension.
  • Drew8MR Why can't CARB leave hobbyists alone? Maybe lay off the low hanging fruit and go after the gross polluters. Bring back the rolling exemption.
  • ToolGuy According to Americans, the very lovely and quite powerful Ford Fairmont (1978-1983) was Way Better.Source: Sales figures.
  • Goatshadow Use case: trade it in the moment the warranty is up.