August 6, 2010

The Rick Report: What a Difference a Year Makes
Exactly one year ago today, AIADA was launching everything we had in Washington, urging Congress and the president to extend the government's unexpectedly successful Cash for Clunkers program. AIADA Chairman Rick DeSilva writes that dealer and manufacturer associations were hopeful that the program would be expanded for at least a few more weeks. Click here to read the request for more funding issued one year ago by former AIADA Chairman Russ Darrow. Two billion dollars were added to the program, which lasted nearly 'til the end of August. A year has made a big difference to dealers. Things are better. Not great, but improving. Not fast, but steadily. It was announced this week that Honda is the third largest automaker in the United States. Five of the ten most American-made cars are international nameplate brands. Number one on the list? The Toyota Camry. See the full list here. That means that international nameplate brands are driving recovery in the U.S. And we're doing it right: by building and selling products that people want to buy. By employing Americans and supporting local communities. By constantly improving upon our success. Since the days of Cash for Clunkers, we as an industry have moved forward. We are laying the groundwork for a real recovery today, founded in solid values. And that feels good. Click here for Rick DeSilva's complete column on the positive direction today's auto industry is going.

Toyota Exec Doubts Workers Want to Organize
Three days after United Auto Workers President Bob King asked automakers to re-examine their resistance to unions, a top Toyota Motor Corp. executive said he doubts factory workers want to organize. According to The Detroit News, union rallies have been held in the past near Toyota plants, and few workers showed up, Toyota's North American Chief Quality Officer Steve St. Angelo told reporters at the Management Briefing Seminars. Toyota has no-solicitation rules that prevent rallies and UAW lobbying of workers inside plants, something St. Angelo said he doubts will change. Unionizing Toyota plants will continue to be difficult because the automaker does not lay off workers even when a plant is down, said Anthony Pratt of PriceWaterhouseCoopers. As part of its public campaign, the UAW has been picketing about 50 Toyota dealerships in California in recent weeks, a move that St. Angelo said puzzles him. "I still don't understand why they are picketing our dealerships when the dealerships have nothing to do with the workers," St. Angelo said. "When the UAW pickets our dealerships, our team members get angry because they want to build cars that are their livelihood." Click here for AIADA's response to the UAW's plans to picket Toyota dealerships. For more on Toyota's Steve St. Angelo's thoughts on the UAW's attempts to unionize employees, click here.

G.M. Pushes for U.S. to Sell Entire Stake at I.P.O.
The New York Times reports that eager to rid his company of the stigma of being government owned, the chief executive of General Motors, Edward E. Whitacre Jr., said Thursday that G.M. wanted Washington to sell its entire stake during an initial public offering. "We want the government out, period," Mr. Whitacre said in comments after speaking at an automotive conference in northern Michigan. "We don't want to be known as Government Motors." Through its sponsorship of the automaker's bankruptcy last summer - including more than $50 billion in loans - the Treasury Department holds about 61 percent of G.M. Analysts have been expecting G.M. to sell part of its shares during the initial offering, but Mr. Whitacre said that the company anticipated selling them all at once. Eliminating government ownership, he said, would be good for employee morale and would improve G.M.'s image. While unusual, selling all the shares during an initial offering is not unheard-of. The stock sale will allow the government to recoup some of the $43 billion in loans that it converted into equity during G.M.'s bankruptcy a year ago; G.M. already repaid $6.7 billion that was transferred to the revamped company as debt. Click here for more on GM's plans for its initial public offering.

Life at 11 Million U.S. Sales
So how does the car business cope with the loss of nearly 6 million annual sales in the space of three years? It reinvents itself - top to bottom. Look around and you see a different auto industry taking shape - a "transformational moment," says AutoNation Inc. CEO Mike Jackson. Automotive News asks, why are companies that struggled in 16 million sales years doing just fine in a market of 11 million? Because discipline is breaking out all over - at manufacturers, suppliers, and dealerships. A pragmatic, tightly controlled approach has evolved from the recession, and the changes touch almost everything. Incentives are smaller, simpler, and more tactical. No-haggle and limited-negotiation pricing are getting a real tryout across the country, and inventories are lean and balanced. Automakers are closely matching production to sales. That means U.S. inventories are hovering near record lows - 2.1 million cars and trucks on July 1, half of the 4.2 million that were in stock on July 1, 2004. For manufacturers, leaner inventories mean lower incentives. Average June incentives were down more than $300 from the industry's peak of $3,165 per vehicle in March 2009, Edmunds.com says. Carmakers have also taken advantage of the crisis to fix structural problems. Click here for more from Automotive News on what the auto industry looks like at 11 million U.S. sales.

11 Four-Doors with Space to Spare, All for Less than $35K
Put four full-sized adults plus their luggage in a midsize sedan for a weekend getaway, and you'll understand the purpose of the 11 cars on Motor Trend's list of reasonably equipped four-door sedans. These sedans aren't canyon carvers or backroad burners, but when you need a comfortable four-door with space to spare, they're ready to serve. Even with a strict price cap of $35,000, the publication found 11 mainstream and semi-premium cars that fit the bill-some expected, and maybe a couple you forgot existed. The focus for this collection of full-size vehicles is comfort, interior space, and rear seat legroom. After all, isn't the point of getting a large sedan that rear seat passengers don't hit the back of the front seats? While considering a vehicle purchase, consumers shouldn't look to the ratings on FuelEconomy.gov as the only source for vehicles that qualify. But for now, relax, spread out, and click here to read through Motor Trend's list of 11 reasonably equipped sedans that are bigger than your average midsized four-door.

2011 Porsche Boxster Spyder: Slimming Effect of a Nice Track Suit
In 1996, Porsche added the Boxster to a product lineup that was just rid of the egg-shaped 928 and the 4-cylinder 968. But the Boxster is 14 years old now, and aside from its ballooning price it has changed very little. According to Richard S. Chang at the New York Times, perhaps to buy itself some time, Porsche recently released a new top-of-the-line version, the Boxster Spyder. Click here for a photo. By design, this 2011 model oozes Porsche heritage. Its double-dome deck lid is reminiscent of the recent Carrera GT supercar. The interior door handles are red straps, famously used in the 911 RS 2.7 of 1973. The name, Spyder, conjures an image of the 550 Spyder of the 1950s. Designed for racing, the low-set 550 Spyder weighed a little more than 1,200 pounds. In 1954, Porsche won its class with the 550 Spyder at the 24 Hours of Le Mans. While it may have been hatched from a marketing perspective, it represents a legitimate upgrade in performance from the S, which is not exactly a slouch of a car. All these alterations can be felt on the track, which is where many Spyder buyers are expected to take the car. Click here for the New York Times review of the new Porsche Boxster Spyder.

Around the Web
BMW Surrenders to U.S. Cupholder Fixation [DriveOn]
What's Your Car Wallpaper? [Jalopnik]
Twinkie-Mobile Gives Weinermobile a Run for its Money [Trend Hunter]
Mansory's Bugatti Veyron Linea Vincero d'Oro Maxes Out the Gold Card [Autoblog]