I was shocked yesterday morning to find that GM CEO Rick Wagoner had resigned, and reading further finding out that it was due to pressure from "the administration". (http://money.cnn.com/2009/03/30/news/companies/gm_bailout/index.htm)
I try to avoid political commentary in this blog, but since when does the government get to decide who the CEO of a publicly traded corporation is? Isn't that the stockholders'/board of directors' job?
In the case of AIG where the federal government has given them huge sums of money (10x what they have LOANED GM for the record) perhaps they have a right to decide who manages the company. But first off GM requested loans which it intends to repay, and secondly just a few weeks ago we were told that 8,000 "earmarks" were ok because it was "only" $7.7bn. I'm surprised congress even noticed the $17bn GM borrowed.
In any event, it is what it is, and I certainly hope GM turns itself around. Personally, I believe it was a good time for Mr. Wagoner to go anyway but it should have been GM's choice not the government's. With the retirement of Bob Lutz and resignation of Wagoner it will be interesting to see how GM handles the upcoming months. Hopefully "Fritz" is up to the job.
On a related note, apparently it's a great time to go buy a new American car. CNN was kind enough to put together a list of undervalued "good" American cars
http://money.cnn.com/galleries/2009/autos/0903/gallery.american_car_deals/index.html
Also released today they'll pay for the car for you (with their negative money apparently) if you lose your job. Or if you get negative equity in the car.
Sounds like a good deal for the consumer, but a big risk on the part of GM, and others offering similar incentives.
Tuesday, March 31, 2009
Wednesday, March 25, 2009
Pulling a Porsche
I was reading today about one of my favorite automotive anomalies. Once small niche market subsidiary of Volkswagen, Porsche, takes control of their former parent company by dramatically buying over 50% of the company. I've often thought of this as a benchmark of success for a small company when they can grow enough to actually take over a much larger entity. Today's news (http://www.autonews.com/apps/pbcs.dll/article?AID=/20090325/ANE02/303259967/-1&campaign_id) is that Porsche is doing some creative refinancing and may increase their VW stake to 75%.
Of course almost every vehicle Porsche produces is a home-run, and they have a very high profit per vehicle due to the structure of their options list. VW on the other hand has produced a variety of market flops (at least here in the US) such as the Phaeton and Toureg.
Unfortunately the American based car companies have no such miraculous news to share. Recently I've noticed the automotive press has downgraded the former "Big 3" to the "Detroit 3", an accurate description since only GM remains in the top 3 automotive producers worldwide. GM announced some weeks ago that they were going to discontinue the "performance" division, fortuitously (for Ford) about the same time that Ford announced the return of the SHO Taurus. It will be interesting to see how this plays out. I haven't had much experience with the GM "performance division" cars, but have heard mostly positive things about them, and many of them brought some glitz to otherwise boring cars like the Cobalt.
One home-run that I am fairly familiar with is the Pontiac G8GT. For ~$30,000 you can have a V8 rear drive large sedan that performs well, and is quite comfortable. Pity that GM chose not to offer the regular GT with a manual transmission, I would seriously consider buying one if that were available. The biggest drawback to the GT is the somewhat ungainly automatic transmission, which compared to the best-in-industry Jaguar automatic seems like it's stuck in a vat of molasses. Of course you can pay about $10,000 more and get the GXP version with a manual, and an extra 60HP, better suspension and brakes etc, however I really feel that the regular GT is adequate in all those areas. Of course this car is made in Australia, so it's not as red-white-and-blue as some of us would like to see, but at least it's coming from an American company. Yet another "bust" in the myth that the Americans can't make good cars.
Of course almost every vehicle Porsche produces is a home-run, and they have a very high profit per vehicle due to the structure of their options list. VW on the other hand has produced a variety of market flops (at least here in the US) such as the Phaeton and Toureg.
Unfortunately the American based car companies have no such miraculous news to share. Recently I've noticed the automotive press has downgraded the former "Big 3" to the "Detroit 3", an accurate description since only GM remains in the top 3 automotive producers worldwide. GM announced some weeks ago that they were going to discontinue the "performance" division, fortuitously (for Ford) about the same time that Ford announced the return of the SHO Taurus. It will be interesting to see how this plays out. I haven't had much experience with the GM "performance division" cars, but have heard mostly positive things about them, and many of them brought some glitz to otherwise boring cars like the Cobalt.
One home-run that I am fairly familiar with is the Pontiac G8GT. For ~$30,000 you can have a V8 rear drive large sedan that performs well, and is quite comfortable. Pity that GM chose not to offer the regular GT with a manual transmission, I would seriously consider buying one if that were available. The biggest drawback to the GT is the somewhat ungainly automatic transmission, which compared to the best-in-industry Jaguar automatic seems like it's stuck in a vat of molasses. Of course you can pay about $10,000 more and get the GXP version with a manual, and an extra 60HP, better suspension and brakes etc, however I really feel that the regular GT is adequate in all those areas. Of course this car is made in Australia, so it's not as red-white-and-blue as some of us would like to see, but at least it's coming from an American company. Yet another "bust" in the myth that the Americans can't make good cars.
Thursday, March 19, 2009
About the Author
Since I jumped the gun and made my first post without having a proper introduction, I decided I should go ahead and do this now, albeit late.
I've always been a car nut. I graduated from Kettering University (formerly General Motors Institute) in 2008 with a Bachelor of Science in Mechanical Engineering with an Automotive concentration. Currently I'm in continuing education pursuing an MBA and M.S. Engineering Management.
Going to college in Flint, Mi I got to be pretty in tune with the automotive industry, and along with my general enthusiasm for the industry, vintage racing, restoration and shows I try to stay on top of things as much as reasonable. Usually attending 2-3 vintage races a year, and several shows.
Since 2004 I have worked in Automotive testing and manufacturing, primarily in the heavy truck industry with some testing experience in military vehicles as well. I like this because it gives me a little bit of distance from the mainstream automotive industry but I'm still a part of the industry.
In this blog I will be commenting on specific events as well as the industry in general on occasion going into some technical depth and providing to the best of my ability objective well informed commentary. I do my best to be technically and historically accurate, so in the event you spot a mistake, or a question feel free to let me know! I hope you enjoy!
I've always been a car nut. I graduated from Kettering University (formerly General Motors Institute) in 2008 with a Bachelor of Science in Mechanical Engineering with an Automotive concentration. Currently I'm in continuing education pursuing an MBA and M.S. Engineering Management.
Going to college in Flint, Mi I got to be pretty in tune with the automotive industry, and along with my general enthusiasm for the industry, vintage racing, restoration and shows I try to stay on top of things as much as reasonable. Usually attending 2-3 vintage races a year, and several shows.
Since 2004 I have worked in Automotive testing and manufacturing, primarily in the heavy truck industry with some testing experience in military vehicles as well. I like this because it gives me a little bit of distance from the mainstream automotive industry but I'm still a part of the industry.
In this blog I will be commenting on specific events as well as the industry in general on occasion going into some technical depth and providing to the best of my ability objective well informed commentary. I do my best to be technically and historically accurate, so in the event you spot a mistake, or a question feel free to let me know! I hope you enjoy!
Tuesday, March 17, 2009
Amelia Island Concours
Spent last weekend in Amelia Island, Florida for the Amelia Island Concours (http://www.ameliaconcours.org/). This was my second time at the show, and as expected it was fantastic from the display area of new cars with everything from the new Hyundai Genesis to a Bugatti Veyron, as well as more unique cars like the Spyker and Iconic.
For me the highlight of the show was a one of a kind Avions Voisin. Moviegoers and Clive Cussler readers will recognize this as the brand featured in Clive Cussler's Sahara, and the movie of the same name. Avoins Voisin is famous for its use of the unique "sleeve valve" engine, however most of these were inline 6. The car at the show was one of only two V12 engines ever produced in this configuration, and all in all this car was the only one of it's kind produced, and was just finished 2 days prior to the show. Unfortunately I didn't
think to ask what year the car was made or other interesting details. This fit into a nice category of cars that I knew of, but had never seen before. Behold!
For me the highlight of the show was a one of a kind Avions Voisin. Moviegoers and Clive Cussler readers will recognize this as the brand featured in Clive Cussler's Sahara, and the movie of the same name. Avoins Voisin is famous for its use of the unique "sleeve valve" engine, however most of these were inline 6. The car at the show was one of only two V12 engines ever produced in this configuration, and all in all this car was the only one of it's kind produced, and was just finished 2 days prior to the show. Unfortunately I didn't
think to ask what year the car was made or other interesting details. This fit into a nice category of cars that I knew of, but had never seen before. Behold!Another interesting highlight of the show was a 1915 Rolls-Royce, supposedly the only one produced that year, thanks to WWI and a "war only" mandate by the English government. This particular car was ordered by Mrs. DuPont, and it is said her request was honored by the King due to her companies role in supplying gunpowder.
Naturally there was a nice selection of seldom seen great classics like Dusenberg, Auburn, Packard, Delahaye etc. All in all, a wonderful weekend, perfect weather, and great cars. A good primer while I'm waiting for vintage race season to start up!
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