By on September 16, 2020

General Motors refuses to let the dismissal of its federal racketeering case against Fiat Chrysler Automobiles stand in the way of getting what it believes is true justice. On Monday, the automaker filed its latest claim with Wayne County Circuit Court in Michigan. These are separate from the New Jersey lawsuit it has targeting former board member and ex-UAW vice president Joe Ashton, who GM has accused of being a hired mole. However, Ashton was named in the trio of new court filings, along with Alphons Iacobelli  the man who pled guilty to embezzling union funds and kicked off a gigantic federal corruption investigation into the UAW.

The automaker also named some of the banks it claimed were involved in the union scandal and continues to allege that FCA “provided millions of dollars to co-conspirators via numerous undisclosed offshore bank accounts and utilized such accounts to purchase the support and silence of numerous high-level UAW officers and FCA executives.” Fiat Chrysler’s assumed goal? Forcing General Motors into a merger or destroy it if the merger failed by negotiating favorable terms with the union and encouraging leadership into adopting positions that would harm GM.

(Read More…)

By on September 15, 2020

Greg Kelly, the American businessman and former Nissan board member that was arrested with ex-chairman Carlos Ghosn almost two years ago, has pleaded not guilty to the financial misconduct charges leveled against him in Japan. While he was supposed to stand trial with Mr. Ghosn, Carlos escaped his captors with the help of at least one U.S. Army Special Forces veteran and a lot of careful planning at the end of 2019. Kelly is accused of helping the former chairman hide millions of dollars in deferred compensation.

During the trial, he defended Ghosn by saying he was an outstanding automotive executive who helped save Nissan in its darkest hour. He also hinted that the firm should have done everything in its power to retain him, adding that his role was to find legal ways of keeping Ghosn from jumping ship to a rival company. While that included financial incentives, Kelly asserted during the trial that Nissan’s attorneys were always consulted before decisions were made and that no illegal actions were taken. “I informed Mr. Ghosn what could be done legally and what could not be done legally,” he told the court. “I believe the evidence will show that I did not violate the [financial] disclosure regulations.”

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By on August 25, 2020

Honda Motor Co. has agreed to pay $84.2 million to settle an investigation conducted by American states regarding its use of the famously defective Takata airbags — units linked to numerous deaths and hundreds of injuries.

Honda recalled about 12.9 million vehicles (some of them Acura models) equipped with inflation devices that ran the risk of accumulating moisture to the point where the propellant inside could destabilize, leading to an overly forceful explosion during an impact. Upon rupturing, these units could effectively spray shrapnel into the cabin area.

While Honda’s first major recalls were enacted in 2008, by 2013 millions of vehicles were in the process of being retracted by rival manufacturers that also used Takata as a supplier. And it just kept getting bigger until it was the largest recall in history, with Honda receiving the most ire due to the high number of fatalities suffered within its vehicles — and for having prior knowledge of the defects. (Read More…)

By on August 25, 2020

Frequently on the cutting edges of technology, the automotive industry has been slamming chips into vehicles to facilitate communications ever since General Motors launched OnStar back in 1996. This evolved into cars boasting reliable navigation systems and remote vehicle diagnostics until they literally started becoming mobile internet hot spots.

Now the industry wants to further ingrain connectivity by equipping all vehicles with 5G — opening the road for new features and the ability to harvest your personal data more effectively.

This has required deals with tech chip manufacturers like Qualcomm, which requires companies to sign a patent license agreement before actually selling any of its hardware or software. But regulators around the globe worried the practice may be monopolistic, violating antitrust laws. The Federal Trade Commission (FTC) brought a case against the business in 2017. Despite winning that case in 2019, a U.S. appeals court overturned the decision earlier this month, deciding Qualcomm could continue conducting business as usual. Now, tech companies (mainly Qualcomm rivals) and a gaggle of automakers are urging the FTC to seek an appeal following the loss. (Read More…)

By on August 21, 2020

The battle between the purveyors of ride-hailing apps and the State of California has been an interesting one. The West Coast’s gig economy looked ready to be nuked from orbit following the passing of Assembly Bill 5 (AB5), leaving a glassy crater of jobless part-timers and the corporations that were dependent upon them — even though the stated goal of the rule was to protect gig workers from being taken advantage of.

Uber and Lyft looked to be the most impacted by the new law, as their entire business structure revolves around managing fares for drivers whose status as “independent contractors” was up for debate.

Claiming that hiring drivers as full-fledged employees would make the existing business model untenable, Uber and Lyft suggested they were looking into alternative solutions while fighting legal battles that would effectively make them exempt from the new law. San Francisco Superior Court Judge Ethan P. Schulman threw cold water on that concept when he ruled against the duo, saying drivers were essential to ride-hailing operations and needed to be treated as regular employees receiving the full benefits they’re entitled to.

The corporations’ last hope was double down on threat to leave the state and hope a California appeals court would grant them an extension to stage another legal fight, or just comply with AB5… which is exactly what happened on Thursday afternoon. (Read More…)

By on August 14, 2020

General Motors’ attempt to revive its RICO lawsuit has failed after a federal court claimed the new evidence presented was too speculative to start the legal process back up. U.S. District Judge Paul Borman dismissed the case with prejudice in July, calling it a “waste of time,” but GM returned with new evidence it hoped might turn the tables.

Filed in November, the General’s case against FCA claims its rival finagled a labor advantage by bribing UAW officials during key contract negotiations. With a federal corruption case still probing the union, and with Fiat Chrysler’s known involvement, it seems like GM might have had a case here. But Judge Borman didn’t think there was sufficient evidence before, and hasn’t changed his mind since.

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By on August 6, 2020

On Thursday, Munich-based prosecutors announced the indictment of four more ex-Audi managers in relation to Volkswagen Group’s infamous diesel emission scandal. This follows the charges brought against former CEO Rupert Stadler and a handful of Audi staffers in 2018.

The latest indictment involves three former board members and one department head who has since retired. Prosecutors stated the alleged crimes relate to 434,420 cars manufactured by VW Group brands which we already know where sold with trick software designed to circumvent emissions testing, according to Reuters and German outlet Handelsblatt. However, the grand total of vehicles suspected to be in violation of regulatory law are suggested to be closer to 11 million globally.

(Read More…)

By on August 4, 2020

Last November, General Motors filed a racketeering suit against Fiat Chrysler Automobiles, claiming its rival was involved in a prolonged bribery scheme with UAW leaders to gain an unfair labor-cost advantage. Despite FCA already having staff participating in a vast union corruption scandal, U.S. District Judge Paul Borman dismissed the GM case in July after claiming there was nothing to it beyond petty corporate squabbling.

Now GM is back, claiming it has new evidence against FCA that’s going to blow the lid off everything.

On Monday, the General asked the court to reinstate the racketeering lawsuit. It now claims that there’s evidence of foreign bank accounts used in the alleged bribery scandal. We say “alleged” despite the FBI’s continued investigation into the UAW (separate from the GM-FCA suit) showing criminal levels of corruption. The company even suggested that Alphons Iacobelli (who is already serving time for bribing union officials) channeled sensitive information back to FCA after being hired by GM. The claimed plot then has Fiat Chrysler paying the Iacobelli  family millions of dollars via overseas accounts.

“These new facts warrant amending the court’s prior judgment, so we are respectfully asking the court to reinstate the case,” GM said.

(Read More…)

By on July 23, 2020

Tesla is accusing Rivian Automotive of poaching its employees and lifting trade secrets in a recent complaint filed in San Jose, CA. Founded in 2009 by Massachusetts Institute of Technology alum R.J. Scaringe, Rivian has made inroads with the automotive sector and established partnerships with entities like Amazon and Ford Motor Company (we think).

While its home base is presently TBD, as the company considers shifting more of its staff to the West Coast, its mission has remained consistent  manufacture all-electric SUVs and pickups so they can wash over North America.

Rivian is one of those “Tesla killers” you keep hearing about before they suddenly blip out of existence, but it has enough weight behind it to potentially offer real competition in the future it plays its cards right. Tesla is just worried that some of those cards might not belong to Rivian.

(Read More…)

By on July 21, 2020

A legal dispute between South Korean battery manufacturers could force Volkswagen Group and Ford Motor Co. to deal with surprise supply shortages, according to documents filed with the U.S. International Trade Commission.

The industrial duo had hoped to see SK Innovation produce batteries at a planned factory site in Georgia to supply the deluge of electric vehicles both have planned. However, courtroom drama between SK Innovation and LG Chem has complicated the matter.

The South Korean battery firms are currently involved in a bitter legal battle. SKI is being sued by LG over claims of industrial espionage in the United States, with the plaintiff demanding SK Innovation not be allowed to manufacturer equipment there. This isn’t the first time the duo have butted heads, either. They seem to really hate each other, and each appears willing to do whatever it takes to gain an advantage over the other. Ford and VW have warned that the situation puts them both at risk of supply shortages during a period where reliable battery supplies are already difficult to come by.  (Read More…)

By on June 23, 2020

On Monday, Nevada Governor Steve Sisolak announced that his state will embrace California-crafted emissions rules that are at odds with the national rollback finalized by the Trump administration in March.

Officially, Sisolak said the rules would not require residents to abandon their current ride “or choose one that does not work for their lifestyle or business needs.” Nevada has, however, decided to adopt higher mpg standards, as well as the Golden State’s zero-emission vehicle (ZEV) rules that require manufacturers to sell a certain number of electric or plug-in hybrid models each year based on the total number of vehicles sold within the state.

Companies in compliance accrue ZEV credits, which can then be traded or sold to other manufacturers for money. As with the Corporate Average Fuel Economy (CAFE) system, those that cannot hit their targets (or afford to buy up credits) will be fined. Tesla actually used such arrangements to make $594 million off its rivals in 2019, with the prospect of things only getting more lucrative for the all-electric brand.  (Read More…)

By on June 15, 2020

Carlos Ghosn’s claim that he was the target of an industrial coup is looking a lot more valid this week after emails surfaced showing a high degree of internal organization regarding his ousting and subsequent criminal charges. The former head of the Renault-Nissan-Mitsubishi Alliance was infamous for wanting further integration within the pact. In fact, his aim was to make sure the tie-up became “irreversible.”

That idea never quite landed for Nissan leadership and Japanese shareholders, with many already holding the view that the alliance had already given French interests too much authority.

Emails dating back nearly one year before Ghosn’s November 2018 arrest clearly indicate top-level management at Nissan had a strong aversion to deepening ties with Renault. While understandable to a large degree, it’s counter to the claim that his removal was strictly about under-reported income and other financial malfeasance that were of particular interest to Tokyo prosecutors. At the very least, some actors at Nissan wanted to make sure the alliance patriarch suffered a massive loss of face while confronting allegations.  (Read More…)

By on June 12, 2020

Ford has weathered heavy criticism for moving bunk transmissions for some time. Normally, that conversation revolves around the PowerShift DSP6 (aka Getrag 6DCT250) installed in passenger cars with names beginning with the letter “F.”

The unit turned out to have a laundry list of problems and ultimately created a ruckus between management, engineers, and Ford’s legal team. Concerned that scrapping the dual-clutch automatic at the last minute would prove a costly decision in the midst of our last economic recession, the manufacturer ran with it — only to be confronted with annoyed consumers who felt the transmission wasn’t anywhere near up to par.

While the DSP6 is the unit that gets top billing for What Were They Thinking: The Movie, it wasn’t the only transmission prompting headaches in Dearborn. Another Getrag-sourced unit, the MT82 six-speed manual, is allegedly a sore sport for Mustang drivers. Owners of 2011-2019 model year Ford Mustangs are now suing the manufacturer for delivering what they claim is another faulty product.  (Read More…)

By on May 28, 2020

Following America’s fueling feud has shown your author that it’s less about finding a reasonable compromise that works for consumers, the automotive industry, and environmental activists, and more about perpetuating ideological wars that now seem to surround every topic filtered through the news media.

Encouraged by industry leaders just days after taking office, President Donald Trump made the fuel economy rollback one of his first initiatives. It wasn’t until March that the softened final draft emerged, however, and it won’t be enough to conclude the almost four-year battle. A collection of 23 states filed suit against the Trump administration’s easing of emissions standards on Wednesday. They argue that the rollback is illegal and based on bunk information.

While we’ve also been suspect of some of the metrics used to make the rollback look more desirable, fueling standards haven’t adhered to reality in some time. The Obama-era standards that would have seen Corporate Average Fuel Economy (CAFE) rise to 54 mpg by 2025 were deemed unsustainable by that administration’s Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA), but were put into play anyway.  (Read More…)

By on May 26, 2020

Volkswagen’s emission-related malfeasance was promptly identified and dealt with in the United States. The company was accused of using suspect software to game testing scores on diesel-equipped models in 2015. By October of 2016, VW was on the hook for a $15.6 billion financial penalty, in addition to mandatory fixes or buybacks on affected vehicles.

Things progressed differently on the European front. Germany has subjected the manufacturer to numerous investigations, ultimately deciding to fine the firm $1.18 billion in 2018 and enact widespread recalls. Civil suits have largely focused on VW’s legal representatives denying the software had any ill intent, claiming it was simply code that mistakenly allowed the cars to become non-compliant with regulatory limits. This didn’t fly, however, with a gigantic UK lawsuit finding the automaker guilty of intentionally misleading customers in April.

This week, VW lost another important legal battle in Germany when the Bundesgerichtshof found it guilty of cheating on emissions testing years earlier. The Federal Court of Justice in Karlsruhe decided disenfranchised diesel van owner Herbert Gilbert was entitled to a €28,000 payday, setting a precedent for thousands of other claimants seeking revenge.  (Read More…)

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