Word has it is looking to establish a base of operations in downtown Detroit in a move that would strengthen its “Imported from Detroit” image. The company is based in Auburn Hills, Michigan, a short hike from downtown proper, but reports say the automaker has signed a lease for 20,000 square feet in the Motor City. (There’s no indication that Chrysler is contemplating moving its headquarters and the space on offer wouldn’t be enough to do so anyhow). Despite this, according to a bit of rumormongering in Crain’s Detroit Business, Chrysler will set up camp in downtown’s Dime Building, but not before unleashing an impressive renovation on the structure.
That’s not all there is to the story, however. You see, the Dime Building is owned by none other than Dan Gilbert, the founder of Quicken Loans and majority owner of the NBA’s Cleveland Cavaliers. Gilbert was one of a handful of individuals who came together to purchase the $225 million loan against Chrysler World Headquarters back in 2010. Rumors immediately began circulating that Gilbert used his position with the headquarters loan to coerce Chrysler, and more importantly, CEO Sergio Marchionne, into leasing the Dime Building instead of alternative locations within the city. Gilbert, who has been on a real estate binge as of late, is said to be the third largest land owner in Detroit behind General Motors and the city itself.
Quicken Loans has since stated the Dime deal was the result of little more than a strong pitch and Chrysler has also denied any behind-the-scenes influence on the decision.
Automotive News is reporting that stories in two other papers, France’s La Tribune and England’s The Financial Times, assert that and PSA Peugeot Citroën are “in advanced talks about an alliance.” Neither maker would comment on the stories, but it has been well documented that both are looking to turn around their European operations. Peugeot’s parent late last year and the immediate this year. Opel lost and with a near-vertical climb ahead based on the prognosis for the European market.
If the talks are concluded in the way reports indicate, Opel/Vauxhall and Peugeot would cooperate on projects from developing engines and transmissions to complete models that each could sell. Peugeot already has partnerships with several other automakers, but none are as involved as this one could potentially be. It’s understood that no shares in either company would change hands, but a partnership this intense would still require the approval of the Peugeot family.
We wonder if Opel/Vauxhall and Peugeot can do together what each can’t seem to achieve alone. Sure, Opel could lower its development costs and with a joint model Peugeot could gain less expensive access to wider markets, but can the two different cultures create cars that would serve their respective brands? Suggestions are that talks are far enough along that an agreement, if achieved, could be announced at the next month.
It’s been seen by millions of viewers on television and the internet, it’s been on both sides of the aisle and it’s been . And, according to YouTube, staring Clint Eastwood has been named the top Super Bowl car commercial of 2012.
For those keeping track of such things, Chrysler’s commercial has over 10.5 million views on YouTube, though we do feel the need to remind everyone that the video was , which we’d imagine is one of the highest traffic times for such advertisements.
The only other commercial from an automotive company that made YouTube’s top five Super Bowl commercials was – itself controversial due to before it aired on the worldwide stage.
The number one ad, you ask? That would be M&M’s “Just My Shell” commercial. Guess there really is no accounting for taste… we prefer our M&Ms to be green, just like everyone else. Feel free to watch Chrysler’s winning ad one more time .
On this episode of As the Turns: Bankruptcy administrators have bidders, and one of them might be a German carmaker!
According to a post on Saabs United, “6-7 serious bidders” are trying to snag the remains of Saab. One European company “is German and located in Munich,” according to the report, which notes that whatever company wins the Saab deal won’t necessarily be the high bidder, but the package that looks the most capable getting Saab back in the car building business.
For its part, Germany’s AutoBild suggests that the actual number of interested parties numbers around 14, though it isn’t immediately clear how serious all of those parties are, though the Chinese are said to remain in the mix, as is an Indian concern.
It’s no secret that plans to expand its product portfolio, . Could a joint BMW-Saab ( or Mini-Saab) platform – shades of the (albeit hopefully better!) – come out of such a deal? Or will the Swedish bankruptcy court reveal that it has a Chinese mistress, one that’s trying to blackmail General Motors? Tune in next week…
Automotive industry analysts are projecting sales of over 14.4 million units this year, a lofty figure . Unfortunately, it seems that those paid visionaries may be an overly optimistic bunch as the actual sales figures – calculated by outside experts – are expected to be significantly lower.
American expects sales growth of 25 percent over last year, while is estimating an 18-percent growth. , and are all aiming for a 15-percent bump. All of those numbers exceed outside calculations, which say industry growth will be at about eight percent in 2012.
Industry experts at J.D. Power and Associates say many automakers have been simply too aggressive with forecasts. “There are painful decisions to be made,” the company said. “Companies need to maintain discipline with realistic forecasts. The recovery is taking longer than expected. Getting too aggressive can lead to bad practices like pushing inventory.” In layman’s terms, production plans are based on sales goals (factories are tasked with producing enough cars to keep the showrooms stocked). If volume estimates are too high, hundreds of thousands of new cars could be sitting unsold at dealerships later this year, leading to an industry-wide incentives war.
In defense of the automakers, the optimism isn’t completely unfounded. Natural disasters rocked the Japanese manufacturers last year, and they expect to use 2012 to reclaim much of their market. In addition, nearly every automaker is introducing new products in high-volume segments. Nevertheless, J.D. Power projects a 13.8 million market in 2012, followed by 15.4 million in 2013 and 16.2 million in 2014.
GOP Presidential candidate Mitt Romney is trailing in the polls in Michigan ahead of that state’s February 28 primary, and the former Mass. Governor thinks the way to close the gap is to bash the bailout of the auto industry in 2009 that saved General Motors and from being broken up and liquidated in bankruptcy court.
Romney’s timing is tough, what with GM’s setting an all-time record profit for 2011.
Polls have suggested that despite the obvious benefit from the bailout to Michigan, state residents have been divided about whether Uncle Sam should have stepped in to keep the automakers in tact.
My big beef with Romney is not that he opposes the bailout in principle (though he did support the bailout of Wall Street), but that he fictionalizes events of 2009 when GM and Chrysler went through bankruptcy. Romney asserts that the companies could have gone through a managed bankruptcy without the help of the federal government. Not true.
Perhaps a better tack for Romney would be to suggest that as long as GM is making such huge profits the company might pay back some of the loans granted it under President Bush. GM got billions before the bankruptcy that it is not required to pay back.
General Motors stock is down 45 percent over the last year, which would lead the uninformed to think that the automaker is still losing money by the bucketload. On the contrary, The General pulled in a healthy in 2011.
Does that mother lode of cash make GM a buy for 2012? Capital research Global Investors seems to think so. The Detroit News reports that the investment firm has purchased 5.8 percent of the Detroit automaker. That’s 92 million shares, which translates to about $2.3 billion at $25 per share.
The investment firm claims GM stock is a strong buy even though its European sales are lagging. David Kudla, CEO of Mainstay Capital Management LLC, points out that there are a lot of automakers selling vehicles in Europe, adding “everybody who does business there is struggling.” The Capital Group also points to continued growth in the U.S. market due in part to pent-up demand as a reason for the big bet on GM stock.
The Detroit News reports is walking away from the company’s pursuit of low-interest Department of Energy loans. The automaker originally applied for an $8.55 billion loan when it was still under Cerberus Capital Management, though the figure had since shrunk to $3.5 billion. The DOE, meanwhile, said it was considering a much smaller $2 billion loan with additional restrictions than were previously negotiated. The loan period would also be significantly shorter. Chrysler had sought the funds as a way to reduce the company’s interest payments, which would have dropped by nearly 5 percentage points had the deal gone through.
Instead, Chrysler will use its own funds for capital improvements. The report says the company has nearly $11 billion in liquidity, though that figure includes $1.3 billion in an undrawn private loan.
Chrysler isn’t the only automaker to walk away from DOE loans. General Motors pulled its application for a $14.4 billion loan last January. The funds would have gone toward retooling. The DOE and the Obama Administration have been hesitant to hand out more government money after the solar panel company Solyndra LLC received around $528 million loans before going bankrupt.
General Motors will freeze the defined benefit pension plans of 19,000 workers on Sept. 30, 2012, shifting them instead into 401(k) plans. Affected workers were all hired before 2001 and are salaried employees. Hourly workers are not affected by this change.
Because the retirement plans will be frozen, contributions will no longer be accepted into them; however, any funds contributed prior to that date will remain intact and will be paid out upon the worker’s retirement.
GM has hired around 7,000 salaried employees since 2001, but these workers will not be affected because they were entered into a 401(k) plan right off the bat in lieu of the old pension program. CNN reports GM made the switch to shift investment liabilities from the company its employees.
General Motors has , and by nearly all measures performed extremely well. Apparently, though, its old pension plan remains 88-percent underfunded, and it remains to be seen how the company will deal with that issue.
General Motors today reported its earnings for last year and the fourth fiscal quarter of 2011. The automaker’s profits for 2011 totaled $7.6 billion, up from $4.7 billion in 2010.
While the news was excellent for the full year, fourth quarter net income was only $472 million, or about the same as Q4 2010. While that makes eight straight quarters of positive numbers since the company emerged from bankruptcy in 2009, the earnings were weighed down by losses of $562 million in Europe from GM’s Opel subsidiary.
There were also a number of one-time events that affected earnings in the fourth quarter, without which GM’s profit would’ve nearly doubled to $900 million.
Still, the company counts 2011 as a successful year, and the stats tend to agree. TrueCar.com reports that GM increased its sales by over 13 percent, increased market share by half a point, grew average transaction prices by over $1,100 and lowered incentive spending by five percent. Based on that performance, all 47,500 hourly employees will receive profit sharing checks of up to $7,000. Check out The General’s official press release .
Successful In Its Mission, But Not As The World’s Greatest Sports Car
Adhered to the Hamilton Hall dorm wall at Wright State University is a glossy poster of a jet-black sports car. It hangs low over an unmade bed, its corner blemished with a slight tear from an errantly placed thumbtack during orientation week.
A young engineering undergraduate, sitting at a desk just a few feet away, is staring directly at the poster. Instead of reviewing for an upcoming exam, his eyes remain fixated on the vehicle’s sleek bodywork, ominous quad exhaust pipes and Brembo carbon-ceramic brakes. Locked in a trance, the student daydreams about what it would be like to drive the sinister-looking monster.
Unbeknown to that 19-year-old scholar, and thousands of miles from Wright State University, Autoblog holds the key to the vehicle pictured on that very poster. It is the . With a 638-horsepower supercharged V8 mated to a six-speed manual transmission and a top speed of 205 miles per hour, it is the most powerful production car in General Motors’ history.
The ZR1 has been upgraded and enhanced for 2012, so what is it like to drive America’s premier sports car on public roads? Can the beast be reasonably tamed? Be pleased to learn that this evil brute is nearly everything expected, a little less and then a whole lot more.
The National Highway Traffic Safety Administration has opened an investigation concerning door fires on 2006-07 models. The inquiry affects over 309,000 of the Chevy SUVs, with NHTSA stating that the door fires were caused by problems with the power window switches or some related electrical parts.
As of this writing, NHTSA has received 12 complaints from TrailBlazer owners about smoke or fires inside the vehicles, and thankfully, no injuries have been reported. According to The Detroit News, has stated that none of the TrailBlazers in question have been destroyed because of the fires, though some interior parts were melted and some seats were singed.
If this story sounds familiar, it’s because NHTSA recently began investigating and models , with some 830,000 Toyota vehicles possibly affected. Because of this, NHTSA is looking to see if General Motors and sourced the power window switches from the same parts supplier. If that’s the case, other vehicles may be affected.
The Chevrolet TrailBlazer shares its power window switches with three other GM vehicles – the GMC Envoy, Buick Rainier and Saab 9-7X – though NHTSA has not received any complaints from owners of those vehicles, The Detroit News reports. A spokesperson from GM says these other vehicles have different door configurations, and thus, may not have any problems.
GM has said it intends to fully cooperate with NHTSA on the investigation. Of course, it’s important to note that this isn’t an official recall yet, but one may be issued pending the results of NHTSA’s inquiry. In the meantime, owners experiencing any problems should contact their local dealership.
Of the remaining General Motors nameplates, is the one that’s most difficult to wrap your mind around. On the one hand, it’s supposed to be a premium brand, but on the other, it’s selling vehicles with sticker prices that tend to start in the $20,000 price range, seemingly encroaching on territory. To wit: The is a bit over $23,000 and the starts just under $28,000, while Chevy sells its , and in that same range. Even the , whose price shot up nearly $4,000 this year, starts at $31,045. Indeed, GM must be using a mandoline to price the different versions of its sedans clustered around the $25,000-$30,000 price range.
But it’s over that threshold where things get really perplexing. Because whether we understand GM’s strategy or not, a twenty-some-thousand dollar Buick makes sense. You look at all the boxes you have to tick on a mainstream brand product to get the amenities that Buick offers and you dump that and all the data about the premium competition in a spreadsheet, and you can probably justify a Buick as a wise purchase. If you’re an actuary or an accountant, all the better.
A Regal GS with a $35,310 base price (or an as-tested cost of $38,155 like ours), however, has stepped onto an entirely different playing field, like a junior varsity kid getting bumped up to play on Friday night. This isn’t the sort of car you research over the Internet and lease after a five-minute test drive. It’s purportedly a driver’s car, something to seek out and manhandle. We thus find it rather disingenuous to compare it with cars from and – the Regal GS is really scrapping with vetted sports sedans like the and , and even its kissing-GM-cousin, the larger .
The modern union movement was kick-started 75 years ago at a factory in Flint, MI. The workers staged a sit-down protest that eventually led to the formation of the first auto union contract. The United Auto Workers and President Bob King (middle) are looking to celebrate that big anniversary by, of course, hitting the streets in protest.
The Detroit News reports that King told a crowd of about 500 union members that the UAW will join with other unions and members of the Occupy Wall Street movement to protest big corporations that pay no taxes “while middle-class Americans are losing their homes.” King went on to rally the troops with promises to fight corporate greed and right wing politics.
King and company plan to start their collaborative protesting on April 25 with a demonstration in front of the General Electric stakeholders meeting in Detroit. Of course GE isn’t all that thrilled about the negative spotlight. GE spokesman Andrew Williams tells The Detroit News that the conglomerate paid a billion dollars in taxes in 2010.
General Motors took dead aim at the during the Super Bowl by airing a spot for the . The ad featured a post-apocalyptic scene where only Silverado owners survived the end of the world and customers were left to fade into the fossil record. Interestingly enough, however, the spot may not have had the intended effect of pushing more eyes toward products.
According to TheCarConnection.com, the ad may have benefited Ford more than . Kelley Blue Book keeps an eye on which vehicles visitors to the site are interested in, and Ford saw an immediate uptick directly after the GM commercial aired. Ford didn’t have a big Super Bowl ad this year.
That wasn’t all. Ford continued to see a swell in shopping in the days after the Super Bowl. Interest in the Silverado, meanwhile, rose slightly when the ad aired before leveling off during the remainder of the game and falling shortly thereafter. Interest in the F-150, meanwhile, continued to surge. According to TheCarConnection.com, the F-150 saw a greater boost in shoppers week over week while the Silverado fell off by 25 percent. Turns out Ford shouldn’t have been after all. Click to see the ad one more time.
General Motors unveiled the company’s refreshed at the 2012 Chicago Auto Show yesterday, and if you were paying attention, you may have noticed something curious about the vehicle. While the new Acadia looks considerably better than its predecessor, a few components of the design looked more than a little familiar. Upon closer observation, it appears that GM has simply repurposed elements of the now defunct Saturn Outlook crossover on the 2013 Acadia. Both vehicles seem to share the same wrap-around rear glass, back hatch, tail light openings and exaggerated, squared-off fender arches.
While the vehicles are differentiated by badging, tail lamps and a rear valance, there’s no denying the similarities toward the vehicle’s rear. Up front, both share similar fenders, though adjustments have been made for the varying headlight designs.
That’s good news if you just can’t imagine life without the Saturn Outlook.
GM isn’t the only automaker to pull something similar. Parts sharing is a smart way to keep costs as low as possible, and recouping the design and manufacturing costs the automaker poured into the Outlook is a smart way to keep GM’s earnings headed in the right direction. For example, famously reused tail lights in the first-generation . We just aren’t accustomed to seeing this sort of recycling on such a grand scale or after so much time has elapsed.
The shows that the rivalry between and still . But is there room for another brand or two to mix it up in the battle for pickup supremacy? Not according to marketing chief Joel Ewanick.
Fox News reports that Ewanick said during a web chat on that “the two big players are Ford and Chevy.” Ewanick added that it’s like a presidential debate, saying “We want to have it with the other strong candidate – and we want to engage them and want them to engage us.”
A quick look at the numbers shows that Ewanick has a point. The was the top dog in 2011, with 584,917 trucks sold. The came in second with 415,130 sales, but if you add the nearly identical , General Motors makes the battle much closer with 564,300 unit sales. That’s more sales than the , and combined (even without the Sierra.)
The Ram, also an excellent pickup, finished a distant third with a reported 244,763 sales. Still, Ram brand spokesperson Dave Elshoff insists that Ram trucks remain part of the equation, adding “across much of the west – where trucks are worked hard – it’s Ram that’s either number one or two in market share.”
We’re not so sure that the truck battle is Chevy versus Ford and then everybody else, but it sure is nice to see GM and Ford getting a little chippy. It’s a good bet that the chatter grows louder as the next generation Silverado and F-150 hit the auto show circuit in about a year.
General Motors has lifted the veil on its refreshed at the 2012 Chicago Auto Show. Designers gave the big crossover a slight redo with a new front valance, headlight details and new interior materials.
Up front, the 2013 Acadia boasts a new grille set into a more vertical nose (reminiscent of the , anyone?), and buyers can now look forward to more attractive diffused LED daytime running lights on both projector and HID headlight-equipped models. At the back, the Acadia now wears wrap-around glass and a redesigned spoiler. GM has also thrown in a few more wheel design options in both 18- and 19-inch sizes.
Inside, the new Acadia offers upgraded materials, including details like French stitching and red ambient lighting. High-zoot models will boast aluminum trim work, as well.
More importantly, the 2013 Acadia will come with what GM calls the industry’s first center air bag. The system is designed to protect drivers and front passengers in accidents where the impact is on the opposite side of the vehicle. The bag inflates from the right side of the driver’s seat and stabilizes occupants during the crash. for the full press release.
When spending big dollars on a Super Bowl ad buy, companies would do themselves well to remember that the successful spots aren’t just the ones being talked about the next day. The ads that more eyeballs actually saw while watching the game were also worth their weight in focus groups.
For the second year in a row, General Motors is claiming that it aired the most watched ad during the most watched event in U.S. TV history. We are speaking of the 30-second spot entitled “” featuring the that aired during the game’s most tense moments, right after the official two-minute warning was reached. The time was 9:37 PM EST and, according to analysis by Kantar Media, more people were watching NBC’s broadcast at that time than any other.
And since this year’s Super Bowl was again viewed by another record audience – 111.3 million viewers in the U.S., not to mention over a billion worldwide – the ATS ad therefore becomes the most watched advertisement on television in U.S. history.
We said this is the second time that GM has claimed this crown. The first was To see the two most watched spots in U.S. television history back-to-back, just .
President George W. Bush recently spoke to a gathering of auto dealers in Las Vegas, saying that while he believes in the free market under normal conditions, he doesn’t regret the $700 billion bailout fund used to rescue General Motors and from the brink of collapse. Bush was quoted as saying he’d do it again, and that he didn’t want there to be a 21 percent unemployment rate. The former leader avoided addressing remarks from the current gaggle of Republican presidential candidates who have criticized his decision to lend a hand to banks, insurers and automakers.
“If you make a bad decision, you ought to pay,” Bush said. “Sometimes circumstances get in the way of philosophy.”
Bush championed a $17.4 billion bailout for the two automakers in December of 2008 as part of the $700 billion Troubled Asset Relief Program. Republican presidential candidate Mitt Romney has said both Bush and current President Barack Obama were mistaken in bailing out the auto industry. Instead, Romney believes GM and Chrysler should have been allowed to go into a controlled bankruptcy from the start.
