Monday, June 22, 2009

Chrysler's new boss and Koenigsegg's new pal

Well tonight I have to eat a bit of humble pie I made a comment about Saab being stuck with GM for another year. Well it's really more like a few months until the lease on the manufacturing for the 9-4x runs out.

Exotic car fans will have heard of a little company from Sweden called Koenigsegg, they produce ridiculously expensive cars and last year the 45 employees of this company cranked out a whopping 18 cars. What can be said of those cars? Well to paraphrase a line from sin city their cars are "boner inspiring."

Why do I mention Koenigsegg? Simple. In an "ant swallowed the elephant" move they are purchasing Saab from GM. What? Yeah that's right this 45 person million dollar car manufacturer is taking on the roughly 3400 workers and the 93000 cars sold last year that Saab has. Did I mention the $600 million dollar financing bill that's being guaranteed by the Swedish Government? Yeah put all that together and Saab may yet live again, or one of my favorite car makers is going to tank.

Little side note here. GM is also selling all but 35% of its stake in Opel and Vauxhall, Saturn is being sold to the Penske group and there is a preliminary arrangement to sell Hummer to a china based manufacturing company. All that's left is for GM to stop buying Daewoo crud (unable to sell in north amaerica due to lacking safety equipment) and selling it under a Chevy badge, with the added safety features mind you, and there may be hope for one of this country's formerly prominent auto manufacturers.

Ok enough stalling, I promised a bit on how Fiat is going to come to own Chrysler, well here goes. In a move that is really allowing Fiat to buy Chrysler stock for pennies on the dollar Fiat is going to be holding at first a 20% stake in Chrysler, later rising to 35% and eventually to a majority stake in the new Fiat-Chrysler alliance. This is all provided deal mandated targets are met and the bills on the bailout money are paid. Let this be a lesson to people in publicly traded companies, never owe too much to too many or you wind up working for someone else.

That's enough for tonight it's time to head back to some 10+ year old re-runs of deep space nine.

Thursday, June 18, 2009

General Motors

Well by now everyone has seen them. I'm talking about the four or five or how ever the F*ck many variations of the same damn screen shots spouting crap they're going to put out there.

Now they're talking about re-invention.

They're talking about a new beginning.

They're divesting the Pontiac division, keeping Saturn and forcing Saab to endure yet another fiscal year of failure being managed by people who have no idea how to market European styled cars, or even electric cars, but their complete mishandling of the EV1 is another story for another day.

We're told that those who don't understand the mistakes of history are doomed to repeat them so let's look at some history of GM.
First off, the minivan, GM had the first set of plans for a minivan but someone at the top decided to sit on them, believing that there was no market for such a thing. What did they get for their hesitation? Chrysler produced the caravan and had a record year (Chrysler is very soon going to be owned by fiat by the way, that story next time).
Second, Trucks. For almost three years they sat on the fence while the other guys made large sums of money marketing trucks to individuals (environmental foolishness of commuter trucks aside since that wasn't why they refused to sell commuter style trucks)
Now for my favorite, V8 rear wheel drive vehicles. in 1964 the mustang was introduced (65 model year cars came out in 64) it was half the cost of a corvette at the time. Now a corvette will run you $70000 and a decent mustang is still only about half that (if not less) and now the challenger (and to a lesser extent the charger) is back and it's most pricey option is really only around $40000. GM seemingly didn't have an answer to the affordable rear wheel drives the other guys were making, then news came in 2007 about the camaro coming back in 2008, it's now the 2010 camaro. Then in 2008 news came about the Pontiac G8 ($40000 for the most expensive version), a rear wheel drive Holden inspired machine (quite nice to drive actually) they finally began selling them and a little over a year later the news came out that Pontiac was going to be no more. Botom line here is they keep ignoring the market for an affordable rear wheel drive car.

So on that what are we looking at for a recent track record? Hesitation, hesitation, lack of innovation. An these are the people who are going to re-invent? So far it seems like the management of GM needs to be "re-invented" but unfortunately we're in a culture where the management of a company who failed gets paid for doing wrong. Now I'm all for keeping GM and Chrysler in business but the people in charge need to be replaced with people who can make affordable, RELIABLE and fun cars, people like those at toyota.