Autoblog

Forbes automotive columnist Jerry Flint provides a history lesson of various automotive couplings and even triads to illustrate that while a few have been beneficial to one or (rarely) all parties, most fall flat on their faces. None, however, are easy for any of the parties, successful or not.

Successful mergers, buyouts, partnerships, and other combos include General Motors' Daewoo purchase and its acquisition of the HUMMER name. Chryslers' purchase of American Motors (AMC) that not only gave Jeep to the automaker but a top notch engineering team. Interestingly, Renault sold its controlling shares of AMC because its French unions couldn't stand the thought of francs bolstering American products. Sound familiar, anyone?

But successful combinations are scarce. Flint discusses DaimlerChrysler's alliance with Hyundai Motors and, earlier, Mitsubishi, both of which fell apart. Ford nearly lost the Brazilian market with its ill-fated Volkswagen alliance in the "AutoLatina" venture. And Flint provides a litany on GM's failed alliances, from Fiat to Suzuki to Isuzu, and the cost of each to the company.

Flint isn't necessarily against mergers or alliances, he just points out that none of them, no matter how successful they are eventually, are ever easy.

[Source: Forbes]

With Kerkorian's proposal of a General Motors and Nissan/Renault merger still sending shockwaves throughout the auto-sphere, auto curmudgeon Jerry Flint steps up to the podium to give his thoughts on 'Global Motors'.

Flint immediately sees a conflict between the automakers over who would be top dog. He sees no 'merger of equals' here any more than the DaimlerChrysler union was and, worse for GM, the world would not expect Ghosn to take a back seat. GM would be run by Ghosn and Nissan/Renault, not Detroit.

He also doesn't see the money savings in the merger, which analysts state is the long-term goal. Which manufacturing plants, for example, would be closed? In France? Detroit? Germany? And how would the brands be dealt with? Rebadge Tennessee-built Nissans as Chevys? Close the French design staff and have GM's designers in Germany develop new Opels? Even before these questions are answered, the involved automakers would need to deal with GM's union contracts and legacy costs that make the original Nissan/Renault merger look like a cakewalk.

Flint concludes his thoughts on Toyota Motor Co., which many merger advocates point to support their idea. The world's second largest automaker continues its relentless march towards Number One and no automaker has come close to stopping it, especially not any domestic ones. Would a Nissan/Renault/GM company be able to even slow down the Japanese juggernaut? Flint points out that it took years for Nissan/Renault and DaimlerChrysler to begin profiting from their mergers, and there are carcasses aplenty of other former mergers (e.g., GM/Fiat; Studebaker/Packard, etc.) littering the ground of history. By the time Global Motors would resolve its issues, Toyota could be unassailable.

Your thoughts on Flint's thoughts?

Related:
Kerkorian: Merge GM with Nissan/Renault?
Toyota buys GM and other improbables
General Motors, more cuts now, says Kerkorian's advisor
Armchair management: what would you do to solve GM's problems?

[Source: Forbes]

Tom Walsh of the Detroit Free Press interviews auto analysts, dealership owners, and consultants on their view of the Detroit Three in the form of a follow up to last week's article on trust.

Walsh admits the results are troubling. Though he points out those being interviewed are business people and are answering from that perspective, they reflect what their customers are buying (or not buying) from them.

Jerry Pyle of Friedkin Automotive, for example, replies that Ford and GM have too many brands and people. Both he and Walter Czarnecki of Penske Corp. see their domestic dealerships selling half or less compared to their Toyota dealerships. And dealership owner Herb Chambers bought several domestic dealerships even though they make no profit because of their low acquisition costs.

Several of the businesses interviewed did acknowledge DaimlerChrysler's success with its 300C and Ford with its new Fusion. But Glenn Mercer of McKinney & Co. points to a current trend by older customers of purchasing near-luxury and luxury vehicles, a weak segment for the Detroit Automakers.

Walsh ends his article as a form of warning to the domestic automakers, their part makers and unions to keep aware of consumer perception when making their recovery decisions.

[Source: Detroit Free Press]

Detroit Free Press columnist Tom Walsh believes the Detroit Big Three are wasting precious resources trying to answer why Americans are not buying their cars. The problems are not prices or how to beat Toyota in environmental issues, writes Walsh, but that domestic automakers need to rebuild the public's trust in their products by making ownership hassle-free.

Walsh states his arguable opinion that the domestics' strengths are low prices, trustworthy service and high quality. Chrysler, Ford, and GM must not only maintain such qualities but keep the public continuously aware of them. That way the consumer may one day forgive them of years of slipshod products and mediocre service. Ford's 'Bold Move' campaign, Chrysler's daring 300, and the new Saturn lineup show that Detroit still knows how to make great looking, fun-to-drive vehicles. Walsh believes all they need to do now is prove they can be counted on.

[Source: Detroit Free Press]

Sex sells, as the saying goes. Unfortunately, Forbes discovered, the pool for this year's sexiest cars--Bentley, BMW, Mercedes-Benz, Porsche, etc.--was small and its members nearly incestuous. Porsche alone had enough models to take all spots. (Not that enthusiasts would disagree.)

So the magazine decided to expand its horizons and look at the idea of a sexy from a few other perspectives. What, for example, would a person living in their car consider sexy? The results:

• Sexiest Car For College Students: Saturn Sky
• Sexiest Car For "Country Living": Dodge Ram Power Wagon
• Sexiest Car For Desperate Housewives: Subaru WRX STi Limited
• Sexiest Car For Hip-Hop Moguls: Rolls-Royce Phantom
• Sexiest Car For Hollywood Agents: Lexus RX 400h
• Sexiest Car For Miami Beach Plastic Surgeons: Lamborghini Murciélago Roadster
• Sexiest Car For Mobsters: Cadillac Escalade
• Sexiest Car For Newly Divorced Dads: Chevrolet Corvette Convertible
• Sexiest Car For Newly Divorced Moms: Mercedes-Benz SL65 AMG
• Sexiest Car For People Living In Their Cars: Honda Element
• Sexiest Car For Washington Lobbyists: Cadillac CTS

(Thanks, Karen!)

[Source: Forbes via Wired News; picture by Chevrolet]

Automotive curmudgeon critic Jerry Flint puts Mazda in his crosshairs for his latest column, Backstreet Driver. He addresses what is a well-known issue about the automaker: There has been no growth in Mazda sales for over a decade.

Mazda vehicles are “it” cars among many automotive enthusiasts, who gush over their handling, bang-for-buck value, and design. The MX-5 (formerly known as the Miata, is one of Flint’s favorite cars), and the Mazda3 is widely considered one of the best cars available among reviewers.

Mazda’s problem, Flint argues, is rooted in its past, when the company tried to compete directly against Toyota on their home turf in Japan. While the company's current "Zoom Zoom" campaign has separated it from the world’s second largest automaker’s shadow, Mazda's small size, still growing dealership network, and leadership shuffle have hampered its growth. Historically, Flint says, companies in similar situations have collapsed, but, he then reminds readers what Henry Ford thought of history.

[Source: Forbes]

Shiro Nakamura, a senior vice president for Nissan Motor Co. and design chief for the automaker, believes that General Motors has been suffering from a lack of awareness when it comes to consumers' needs:  "there was a lack of customer-orientation." And arguably, he should know: Nakamura previously worked for Isuzu Motors Ltd. during the Eighties before joining Nissan. GM and Isuzu had formed their alliance a decade earlier and Nakamura met and worked with many GM designers at that time.

But despite GM's current problems, Nakamura remembers the company fondly, saying he had worked with some of the world's best designers. It will be interesting to see if he applies any of that experience as he assumes chief creative officer in Nissan this month.

Is Nakamura correct? Take a crack at the issue in 'comments.'

[Source: Associated Press via The Star]

On Fox News, Steven Milloy writes about the backlash suffered by Ford CEO Bill Ford, Jr. at the hands of various environmental groups. The organisations have expressed their displeasure by pointing out that the Blue Oval still produces too much pollution from its manufacturing (“more heat-trapping pollution into our skies each year than the entire country of Mexico”); continues to produce gas-guzzling SUVs; and argues that the automaker opposes proposed California legislation requiring reduction of carbon dioxide emissions by 2016. The ridicule climaxes adjacent to the pictured ad in the New York Times.

However, Milloy takes issue with the criticism, pointing to what he considers the fallacies of the groups' talking points. But he reserves the bulk of his ire for Ford himself, who he believes is too 'occupied' trying to appeal to the environmental groups, even when such overtures threaten the company's bottom line. For example, Milloy points out that according to the Alliance of Automobile Manufacturers, complying with the California law may reduce CO emissions by a 'minuscule' amount while raising vehicle costs by thousands of dollars.

Specific details can be found at the link. When you come back, fire off in Comments.

[Source: Fox News.com]