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Automotive RSS FeedsGet a plan - It sounds like an eminently sensible step. Before you get the bailout, can we please see some sort of plan of what you are planning to do with the cash and how you intend to make your businesses viable? Yep, that's sensible and the least taxpayers deserve. These will be the most important reports these companies have worked on, period. And there will have to be some serious work done to get something credible ready by early December. As ever, it's a shame that things have to get to a survival threatening level before minds are properly focussed on what's gone wrong and putting it right. But this could be (ought to be, even) a defining moment if the analysis of the situation and what needs to be done are really up to scratch. US: Congress wants auto industry plan...Feed Source: www.just-auto.com Surreal times? - That was a little out of left-field, eh? Was it a clever PR stunt yesterday by SolarWorld to say that it is planning a bid for Opel's German facilities or is it really serious? Before we all laugh it off as a cheeky stunt, let's just reflect on how desperate for cash certain companies are. GM is to sell a 3% stake in Suzuki to raise a bit over $200m. SolarWorld is talking about a billion euros for four factories, the products produced (royalties and rights would surely be negotiable) and Russlesheim's R&D (more tricky, but might be a way to share). Mad?GERMANY: SolarWorld AG 'planning to submit Opel offer to GM'... Detroit deadlock - I was just catching up on the latest news. Asian stock markets have followed the Dow Jones downwards, there's still political deadlock in Washington over the Detroit bailout and worries have intensified over the recessionary outlook for 2009.
It would seem that the markets have taken fright partly because of the deadlock over the US auto industry and are considering the implications for the US economy if no 'bailout' is forthcoming.
I reckon it will be, but politicians want to give the leaders of the Big 3 (or Big 2.5) a bit of a public going over first.
It's almost painful to watch as Wagoner/Mulally/Nardelli put up a united front and are subject to some fairly predictable barbs. It was inevitable though.
They may well have to offer their heads up, but I'm not sure that would be the right thing to happen. Wagoner was actually doing the right things before the rug was pulled by the financial crisis and the GM recovery plan was ... HuffPost item - There's a good point made below by Pieter van Rosmalen about the impact of exchange rates on published profitability figures. What exactly is the underlying picture at GM in Europe? Hmm. I guess that could cut the other way in other examples where profits are exaggerated. One for the accountants.
A blogger at the Huffington Post, Diane Tucker, has been in touch to refer me to an interview with Peter DeLorenzo (the sometimes provocative and very readable Auto Extremist blogger). It's quite a neat summary of the (for want of a better term) pro-Detroit line.Journalist to GOP: You're 100 Percent Wrong About U.S. Automakers... The new game in town: 'What If?' - The turmoil in Detroit is now causing bigger waves to ripple elsewhere. And it's not just, 'We want a fat soft loan like wot they got' which was the rather crude, if brutally honest, message that recently came out of the European automakers' trade association ACEA.
I spent a bit of time yesterday on the phone with a journalist in Brazil and his questions were the same as many doing the rounds this week in Brussels, Berlin, Stockholm and I dare say plenty of other places across the globe. They boil down to this: what if? What if GM or Ford really goes down? What happens to the local factory that makes GM/Ford cars?
I was having another conversation with someone recently about Delphi. It's still in Chapter 11, but I was told you wouldn't know it to talk to the European Delphi people who haven't really been much affected. And, the Delphi Euro-people maintain, it's actually been a positive thing for their business in the round. Maybe.
... Tough calls - The downbeat news just keeps on coming. It seems relentless at the moment, but we are at that stage in the cycle when everyone is reassessing the demand outlook for next year and adjusting operations accordingly. Economies are on the way down, so good news will be in short supply, few looking ahead to the recovery phase at this point. The storm's still blowing in. And there's the underlying elephant in the room which is the whole credit situation and how quickly we'll have a return to credit being more available.
While the spotlight is very much on Detroit, it's perhaps worth noting that Europe isn't looking too pretty either. Renault's Patrick Pelata has said he sees a 20% decline next year. Gulp. That's perhaps a measure of how far people are taking their market forecasts down right now. It's downward revisions all round.
But, if the credit situation is gradually 'resolved' in the first half of next year the outlook might star... RTE news - A young lady who works at the Irish national broadcaster RTE on their newsdesk called me the other day. Would I care to be interviewed in a programme slot about the problems facing Detroit? Er, yes, I guess I could, I said. I've a face for radio and I was assuming that was what we were talking about, RTE being based, I also assumed (correctly), in Dublin. The great thing about radio interviews is you can do them down the phone or, these days, on high quality Skype, disruption to daily routine kept to a minimum. I've done loads on BBC World Service radio over the years.
The RTE lady asked very nicely and I was on my cell at the BMW thing (see below posting). I said yes and that was that. It turned out to be TV. It's not that I don't like doing TV stuff - I do, actually - but you normally have to physically get yourself to a studio and that's a slight hassle whichever way you look at it. If you're wondering, do t... Cars that last - Here's a thought. There's a vibe around that is changing the way consumers behave across the board. Even if you are not directly impacted by harder economic times, you may start to behave differently, feel that you should be cautious with your spending 'just in case'. And lots of people are eschewing conspicuous consumption; you, perhaps, are being carried along on that tide a little, even if you are unaware of it.
It might mean shopping for bargains online, a renewed enthusiasm for camping holidays, buying groceries at Lidl or hanging on to your car a little longer before replacing it. And if you do hang on to your car, you may be very pleasantly surprised that not much goes wrong with it. They're well built these days. In fact, the whole financial merry-go-round that involves finding the money to spend on an expensive asset that rapidly loses value might be called increasingly into question.
That thought was brought into focus while thinking... BMW 7 - I'm out to a drive event for the new BMW 7 Series tomorrow. That's some vehicle to be going to the market with right now. It looks a lot like the old one, the Bangle dial turned down a tad. Is iDrive easier to use? I hope so. But however good the car is, I wonder what the volume outlook for it looks like. The UK market could be tricky, along with some others, company directors and the like feeling the pinch and tightening belts.
But BMW has managed to make it lighter, greener and still more powerful than the one it replaces. That's not a bad achievement is it? What say you Mercedes?GOLDING'S TALK: The man who sewed together the new 7 Series... Flip side of the coin - It's funny how some market characteristics that look like negatives, can turn out - in certain circumstances - to act as positives. So, consumer credit is not very well developed in China and most vehicle sales there are for cash. Until recently, that was seen as an area to be worked on and as something of an opportunity. Just think of all those additional car sales that will happen when consumer credit infrastructure is in place, the thinking went.
And then credit availability dried up worldwide. Credit availability is an issue for both dealers (who can't get finance to buy stock; that's hitting in places like India and Russia) as well as consumers. But if the market has been driven by financed sales, then look out when credit is squeezed. The market takes a tumble.
In China's car market, paradoxically, such financial strains won't be felt as much because credit finance for car purchases is only a small part of the pic... Lada 2116 - We have just published another feature that has resulted from Mark Bursa's recent trip to AvtoVAZ. The first feature put the place in historical context and the latest says more about current developments and the future. I must say, the Lada 2116 - off the new AvtoVAZ C-platform - doesn't look half bad; ditto the upcoming CUV. As ever, Mark's honed eye for the unusual brings us something a little offbeat - in this case his observations on the portraits in reception (have a look in the article gallery).
Included there is Vladimir Kadannikov having a puff on a ciggy outside AvtoVAZ HQ, leaning against a Samara. Nice picture. The image file Mark sent through was called .wait for it Vlad the inhaler.jpg. He can be very droll that Mr Coolbear.
As myself and Matthew Beecham agreed yesterday while reviewing the 3M Q&A (and more particularly the 'bonding' puns at ... Russia's president is a GM St Pete plant fan - I see Russia's president Dmitry Medvedev was at the GM Russia plant opening ceremony last week, along with the US ambassador to Russia. Medvedev may have made some icy remarks about the US recently, but it sounds like he appreciates investment by US companies in his country.
"This is a great example of investment cooperation between Russia and the United States," Medvedev said at the ceremony on Friday.
Medvedev - who hails from St Petersburg - was also at the groundbreaking ceremony for the plant two years ago, as first deputy prime minister.
"I was given a shovel as a souvenir, which I still keep at my dacha with other gardening tools," Medvedev said before inspecting the interior of a Chevy Captiva off the line.
Practical chap. Gets given a shovel at a groundbreaking ceremony and hangs on to it. I like the idea that it's got a great big GM logo on the handle, perhaps alongside a slick representation of the two nati... GM and Chapter 11 - The enormity of the seismic shift happening in Detroit is still sinking in. There's not much time and it's quite a dilemma for the US government. Would a 'bailout' be the right thing to do? What would it really mean and would it just be delaying the inevitable, throwing good money after bad?
Is Chapter 11 actually what GM needs to get its US house in order? Would that enable it to slim down, reduce cost (and shake up the UAW deals further) and eventually emerge leaner and fitter? What would US ops in Ch 11 mean for the rest of the company outside US? Business as usual?
There's the oft-cited case of the US airlines emerging from Ch 11 restructured and able to carry on, but what about a car company in Ch 11? What would that mean for customers (and perceptions) and would it really be workable?
There are lots of questions being looked into now and I get the impression we have moved on a little since Friday. It's become 'what are the implications of Ch... 'Bionic legs' for factory workers - There have been some interesting innovations to help improve the lot of the assembly line worker over the years. Here's something that Honda has come up with that redistributes the weight and makes it easier to crouch or stand for long periods. I am sure it's ergonomically very clever, but the word 'wedgie' springs to mind. ... Hindsight is a wonderful thing - Amid all the analysis and comment about Detroit results today - Ford (not too bad) and GM (very bad and liquidity is a big worry) - Chrysler's future has been thrown into further uncertainty. What will happen at Chrysler if GM doesn't take it? How do we take Wagoner's comments today that the talks are off? Is that really final or are there further acts to be played out involving US government money?
I'll just say this: what a state. I know people are saying (with the all-seeing benefit of hindsight) that this was a car crash waitiing to happen, but few could have predicted what's going on now. While Chrysler (seen by some as the US Rover) was perhaps always a bit vulnerable, it strikes me as ironic that GM and Ford outside of the US are still doing very well. And they have been doing the right things to rebalance and resize in North America, painful though it is.
I guess the 1990s/early-2000s drift into relying on truck sales i... BMW and Daimler under pressure - If you make prestige products that come with a hefty price tag, you might well be feeling a bit nervous at the moment. Here in Britain you can buy a great big fully loaded three-year-old Mercedes luxobarge for the price of a bag of sugar. Horrific residuals are a part of an unfolding story that looks set to get worse in 2009.
What do you do if you're a bit typecast with product that isn't all that fashionable in credit crunched and energy cost conscious times? In Munich and Stuttgart they have long known that they need to have a strategy in case the market moves away from large, high-margin premium cars. Make hay while the sun shines, but have a plan for when it doesn't and don't have all your eggs in the premium car basket. There are other tricks to perform that can act as a kind of hedging for when bad times come.
There are options. One thing you can do is develop alternative brands. This has worked well ... Motorsport - I know it's a little at the margins, but the interview I did with Spyker's CEO Victor Muller (it first appeared in the Lotus e-magazine proActive) did unearth a few things.
For one thing, I was reminded of that old joke: Q: How do you make a small fortune in Formula 1? A: Start off with a large one. Spyker's F1 involvement was a financial nightmare and Muller simply admits that he made a mess of it (well he says 'we' but he is the boss).
The volumes may be small, but it is interesting to reflect on how the business model works (or not) in the world of exotic sports car manufacture. Where does Spyker sit in the market? This quote is a beauty. I love the way Victor Muller kind of looks down on Ferrari. I know, they are rather everyman aren't they?
"We are not competing with Ferrari or Aston Martin. When you have made your first million pounds then you go and buy a Ferrari, not a Spyker - not yet. Tha... AvtoVAZ - When Mark Bursa went to visit AvtoVAZ in Russia, he was bound to get quite a bit out of it. For one thing, he's interested in the history of a manufacturing operation like that beyond just the nuts and bolts of what it produces. He's also interested in the political and economic context of what he finds, different ways of doing things. And that ties in, of course, to the unique political culture and history of a place like Russia.
The flavour certainly comes across in a piece he has just done for us. He's also interested in all things engineering and that includes aircraft and maritme vessels (spacecraft, too, probably). He must have been like a kid in a sweet shop when he saw some of the stuff outside the AvtoVAZ automotive plant. It's not every day you see a submarine or a whirlybird like that .fortunately, the Coolbear had his camera with him and so can s... Obama - good for Detroit? - As the news sinks in that the next US president will be Barack Obama after all, I must admit that I am wondering how Detroit feels about it from the rather narrow viewpoint of whether or not he's good for the auto industry - or at least a net gain over what the alternative would have been.
Of course, there's the wider debate about economic policy and dealing with depressed demand. That debate will run and run, but I guess a Democrat administration might be more inclined to use the lever of public spending to stimulate economic activity in times of recession. And that, the conventional theory goes, means a bigger market for lots of capital and consumer goods, including vehicles. But then Republicans might say that is counter-productive because it means higher taxes and that chokes the economy. Hey, let's put that to one side. If anything, maybe we're into crisis management on the US economy given the backdrop of the deep ... Hug a service technician? - It's been quite a day today. The October sales numbers for the US looked pretty horrific. BMW said that things have got so volatile it's not prepared to offer forecasts for its 2008 fiscal year financials. And yet more national car markets were reported as down in October. I have just been speaking to our financial guru Rob Golding and he said and I quote: "I am a very big bear at the moment." Yikes. (Speaking of bears, look out for a Coolbear's thoughts on AvtoVAZ tomorrow, published exclusively on just-auto, following a recent visit. I spoke to him earlier and he confirmed that he was indeed force-fed vast quantities of vodka on the trip to Togliatti.)
But at least the Canadian market was up last month. It's a positive but local industry man Dennis DesRosiers warns that it might ... Copyright © 2008, Selling on Ebay, Make Money on Ebay. All Rights Reserved. |