Recent Comments:
Chrysler's financial arm no longer offering leases {Autoblog}
Jul 25th 2008 6:34PM When you lease, you pay for the use of the vehicle based on this simple formula:
Selling price-projected residual= your cost/ term (48 to 72 months)+taxes.
This way you pay for the part of the depreciation you used up and you save on taxes since the tax is charged only on your payments.
Then, you give the car back to the manufacturer.
(or buy it for the residual but this is rare).
In fact, this is why customers lease Mercedes, BMW, SUV's, ; the payment is much smaller, and, you don't bare the risk and repairs that involves an aging vehicle. You also don't have to sell it and pay for the depreciation.
What Chrysler says is this: now you , our loyal customers, will bare this risk and buy our vehicles.
The Dealers will not stand for this and will sue Chrysler. In my area, 70-80% of the sales are leases. Maybe this way of selling car does not work anymore, no matter who is the manufacturer. It has created a parrallel network wich sell the same vehicles and who does not take the hit since the financial institutions took it.
All of this leasing created an artificial sales level which is unsustainable .
Now back at Chrysler:
- Nardelli is an overp[aid executive who was hired by Cerberus who don't have the expertise to run a car corporation.
-Toyota made Jim Press and not the opposite. He will leave the ship. Nothing he can do here.
This is , in my view, a fatal blow to Chrysler, unless they team-up with another corporation.
IIHS crash tests small pickups, majority flunk {Autoblog}
Jul 24th 2008 10:15PM Tacoma: 16/20 mpg
Colorado: 15/20 mpg
No big advantage here.
As far as crash protection, it just inflates the price. Nobody buys a truck , or a car for safety reasons. When India or China will come up with a plain Jane, no air bag, no abs, no stabilitrack, no nothing but a super price, then we'll see if safety sells.
Safety, IMHO, is the same as the new "green" market.
A lot of customers like to say they want it, but in the end, most don't act on it. Customers wish wish wish but when they buy buy buy, the story is quite different.
Honda cuts Odyssey and Pilot production; makes room for more Civics {Autoblog}
Jul 21st 2008 6:44PM Honda Pilot: 16/22 MPG
Acadia AWD: 16/23
Odyssey: 17/25
Chrysler : 17/24 for much less money
Ridgeline: 15/20
Avalanche 2wd V8:14/20 (V8, not V6)
Not very impressive fuel economy here, considering the price that Honda is asking. Of course, we have the "resale value" and "Honda Reputation" . Ridgeline and Pilot (I will not mention Element , I did not have sex........, you know the story) have suppositly a look that grows on you... Well maybe with some journalist or CR, but not on anybody around me.
Bush says no bailouts for automakers {Autoblog}
Jul 16th 2008 8:51PM This blog makes me think more and more about the late Conbustion Chamber in Autoweek. They ceased to exist because it became a nest for bashing, politics, hate and trash, in summary nothing really constructive.
If Autoblog does not stop this, thay will have the same fate.
I suspect that many people here are auto corporations and dealers employees. Auto enthusiast? Not really....
Obama calls GM a "sobering reminder" of U.S. economy woes {Autoblog}
Jul 15th 2008 9:39PM The us government allowed the UAW to go from 30000 members to 500,000 and gave them the monoploy of the US car industry.
Time to send the elevator back, my friend.
GM's Wagoner to elaborate on business plan tomorrow {Autoblog}
Jul 14th 2008 8:24PM Yeah right....
GM's Wagoner to elaborate on business plan tomorrow {Autoblog}
Jul 14th 2008 7:12PM What Wagoner is going to say is this:
- Massive white collars reductions.
- Realignment of Zone
offices .
-Retirement incentives and buyout to salaried employees.
- The 30+ employees who retired on the job will have to go this time; they won't be offered other alternatives.
- Substantial reduction engineering staff affected to the truck business.
- Major reductions in middle management jobs.
- Reduction in benifits for salaried employees (health, cie cars mostly, pensions have been already revised).
-Possibility of salary cuts by as much as 10%. This will pave the way for renegociation with the UAW; actual rank and file will be impacted this time. They will not kick the can to the other generation. Let's be serious here.
- End of the stock purchase program.
-Camaro will be killed, forever. Canadian Oshawa plant will be closed.
- No major announcements as far are brands are concerned; they can't afford to kill brands at the moment.
- Major restructuration of the organizations and structures (salaried mostly).
GM has to reduce the structure by 4 to 5 billion $$. Not exactly chump change.
Believe me, it will be big and massive. This will be devastating to many families.
By the way Autoweek blogs (Combustion Chamber) ceased to exist because of immature people who had a lot of fun bashing corporations (Japan or USA does not reall matter).
What is so funny about employees loosing their jobs?
GM and Chrysler say bankruptcy not in the cards {Autoblog}
Jul 11th 2008 11:40AM In Korea and Japan, the government participates and provides support to their auto industry:
- Health care
- Hybrid development cost (Toyota)
- Taxes
The two countries also have very restrictive importation policies (especially Korea), which cause huge trade deficits.
In USA, the social burden is taken care of by the large corporations, which of course have driven up the cost disadvantage vs Asia.
The other part of the equation is that USA is the home of frivolous lawsuits, which cost a bundle to those same US corporations.
Back in the 50's, Ford started this whole thing about paid layoffs, not GM. So GM is often accused of giving away too much to the UAW. Not exactly how it started.
On this subject, in USA, you have a law which was voted in 1935 that gives the right to the employees to be part of a Union.
Problem is that in 1937, Frank Murphy, governor at the time and mediator in the Flint strike between GM and UAW, gave the UAW the exclusivity to represent the entire auto industry. This had an incalculable effect upon the fortunes of organized labor and institutionally recognized its legitimacy. In the next year the UAW saw its membership grow from 30,000 to 500,000 members
We can blame the UAW all we want, but US government is responsible for the creation of this gigantic and powerful union. The UAW became the best paid workers in America.
So in fact, whatever Obama or McCain are saying, they carry the heritage of the USA labor history. They can try to ignore those trivial questions and let their own industries die. It will not be so easy when they will have to drive a Toyota or Honda limo. They do have an historic responsibility, whether they like it or not.
GM stock drops below $10 per share {Autoblog}
Jul 4th 2008 11:23PM No offense, but your comment is so trivial. This has been said so many times that it is not even funny. Go read Autoextremist.com.
Very interesting thoughts on how USA is imploding and working agaist each other instead of pulling together, which is the principle on which this country was built.
Now it's (quasi) official: Chevy Beat to U.S. {Autoblog}
Jul 3rd 2008 3:33PM I live in Eastern Canada and the small car market here is huge (70%). Now , with the credit crunch and gas price, americans may rethink the car market.
Since the first petroleum embrago in 73, and then 1980,1990 2008, Honda and Toyoyta always got a larger and larger market share.
The head offices of the big three sould be relocated outside Detroit. This is the only way that their management will see the light.
SUV era is not over yet, but there is room for a nice small car which does not look like it has been created to meet CAFE standards.
