Auto Ramblings

National Automobile Dealers Association

NADA asked the Federal Government on August 19, 2009 to suspend the CARS Cash for Clunkers Program because, by their research, the $3B has been exhausted.

It is clear that the CARS program has lifted vehicle production quotas, especially for fuel efficient vehicles.  Automotive Tribune is of the opinion that winding the CARS program down will result in a long term Federal program that will encourage purchase of high mileage vehicles.

‘Old Chrysler’ Creditors Sue Daimler Over Assets

Daimler still owns 19.9% of Chrysler.  However, since the failed “Merger of Equals” things have again started to heat up.  It is clear that a great deal of discontent is evident because of the Chrysler meltdown.  Watching this litigation will definitely produce another round of very nasty automotive finger pointing.  There will be plenty of media coverage … stay tuned.

Bite of the Viper

Bitten By The Viper

Chrysler CEO Bob Nardelli has potentially opened a proverbial Hornet’s Nest by saying that there were no serious interested parties for the Dodge Viper and inaccurately stating the offers for Viper.  In Washington on June 4th it came out that a Michigan-based investor group had offered $35 million for the Viper car line.  However, Chrysler reported in their bankruptcy filing that the best offer that came along was $5.5 million.

This Looks Like A Major Error

His statement may be valid, although at this time it is has become public that the higher offer was made.  This mis-communication may be an honest error on the part of Mr. Nardelli.  Unfortunately for Chrysler and Mr. Nardelli, Washington, D.C. Congressmen and Senators will likely take this topic and turn it into a media show that will not be good for Chrysler.

Chrysler Smoke In Washington

For now the smoke is rising on this matter and it has been said that where there is smoke there is fire.

The Real Money

Viper value is a “drop in the bucket” of money associated with Chrysler.  This money is almost totally negligible when keeping Chrysler alive.  Although, if there is an error in reporting the information then everything that Chrysler brings forward will be suspect.  That outcome would certainly make future negotiations between Chrysler and the Government much more challenging.

Motor City Challenge: “Failure Is Not An Option”

Motor City Challenge: “Failure Is Not An Option”

GM Entering Bankruptcy and Chrysler Poised to Exit

Reading the Wall Street Journal or watching the nightly news makes it seem inevitable that GM will enter bankruptcy soon.  This is not an unexpected event as reported in the Tribune over the past months.  Chrysler appears to be on the verge of coming out of bankruptcy, and this is one fast trip in and out!  GM is too complex for a speedy journey like Chrysler.

Deadly Symbolic and Deadly Serious

In some ways this is symbolic and in some ways it is deadly serious.  Looking at the deadly serious side GM absolutely must be re-cast properly for the good of the US and all of North America if you take the proposition that GM is worth saving and the Tribune takes that position.  However, re-casting GM is not simple from the business plan side of the equation and it is imperative that the new business plan must “hold water” otherwise the entire Government assistance plan is flawed.  The New GM absolutely must have a viable business plan.  … Continue Reading

Auto Dealer Agony

Auto Dealer Agony

It is almost impossible to imagine that auto dealerships would be in such chaos today.  Dealerships, particularly for the domestic brands, are closing by the hundreds and thousands. 

Auto dealerships have been economic engines of success.  Yes there have been some failures as manufacturers and products have disappeared over the past 100 years.  For decades owning a dealership has been a “license to print money” in the opinion of your Editor who happened to have a dealership for 10 years.

Historically, auto dealers have been great community citizens.  Dealers have sponsored little league and many sporting events along with a multitude of civic and community activity.  Event sponsorship was because they had money to do it an they were part of the local “fabric of society” … Continue Reading

2009 Jeep Commander

2009 Jeep Commander Commands The Highway

Driving the 2009 Jeep Commander is sort of like being King of the Highway.  This is definitely not a Jeep Renegade or Jeep Cherokee.  This is one big and awesome sport utility vehicle.

Rental Car Roulette

Several days ago I had the opportunity to be asking the lady on the other side of the rental car counter at the Denver Airport for the quick exit special that I had signed up for with my normal profile.  She said you can have your choice of #1 or #2 or #3 … you get the picture.  I said, let’s try the Jeep.

Let’s Try The Jeep … Continue Reading

US Auto Industry – Beyond the US and Beyond Graduate School

Chaos Brings Opportunity — In The Real Graduate Business School

If chaos brings opportunity then current circumstances present a multitude of opportunities in the car business. Undoubtedly, present circumstances represent a set of issues absolutely unforeseen except in a Graduate Business School program. Even there, variables that have brought on the current situation would have represented a set of circumstances that would be almost unimaginable.

An Unimaginable Scenario Even In Business School

If today’s situation were visualized as a raging river that needed to be crossed then the raging waters would include the economy, weak demand, and industry collapse. Players crossing the river represent an intrepid and diverse group and these players are crossng the raging waters right now because either they must or they see opportunity. Some group members chose this pathway and some had no choice but were swept up in the torrent and some did not have any opportunity but to participate or see collapse of a strategic industry in the US, North America and World.

Is It Academic and Historic

Two decades ago the scene was set for a massive business takeoverthat became the story memorialized in  Barbarians at the Gate written by Bryan Burrough and John Helyar describing a massive Wall Street and Industry economic power play.

This masterful work memorialized how financial minds envisioned and executed maneuvers to control huge financial sums and industries and has been called one of the most influential business books of all time — the definitive account of the largest takeover in Wall Street history.   This tomb addressed a facet of business that was totally dominating or crushing depending on which player you study.

Auto Industry Reality Is Not Academic

Today’s auto industry reality makes Barbarians seem to be only a prelude to the real business, industry and governmental drama. Reality composed of GM and Chrysler collapse, dealers terminated in a wholesale manner, UAW rethinking just about everything, US Government input to business plans, car lines being shut or sold, key players and groups stepping up to acquire select assets. These circumstances are absolutely beyond Graduate School Business Class 633.

The Real School of Hard Knocks

Current status of the US and World auto manufacturing is absolutely hard ball.  There are massive implications for current Corporate and National priorities around the Globe. 

Significance of the current situation has implications which go far beyond today’s immediate chaos.  Decisions made in 2009 will very tightly set the course of the Global auto industry tightly for the next five (5) to seven (7) years and set he paradigm for long term future.

Massive changes are going to happen in 2009.  Stating that another way, a hundered years ago was the foundation fr what is in place today.  How far into the future the survivors and new players go remains to be seen.  However, for the next hundred years, or at minimum couple of decades, decisions made in 2009 will play a seminal role in automotive manufacturing dominance.