Showing posts with label U.S. Government. Show all posts
Showing posts with label U.S. Government. Show all posts

Thursday, October 1, 2009

Toyota To Recall 3.8 Million Vehicles

BREAKING NEWS! BREAKING NEWS!

In what I can say unequivocally would happen three years ago, I told you so, well not to this magnitude, but sooner or later in Toyota's quest to become the worlds leading auto maker, the teflon shield would start to crumble.
The perils that dogged General Motors for the better part of the last 2 1/2 decades, "QUALITY" would come to inflict pain on Toyota Motor Company. When you become as large as General Motors and now Toyota, quality issues will rear it's ugly head and cause havoc on consumers perception and viewpoint on a manufacturer and becomes even more difficult to change. Audi could do it as it was much smaller and although nearly out for the count, the sample size of vehicles were minimal in comparison to the millions of vehicles that GM and Toyota sell. To many opinions and misconceptions will abound and becomes a public relations nightmare, were talking 3.8 million vehicles and the families that are associated with those vehicles, you do the math.
The recall effects 3.8 million Toyota and Lexus vehicles mostly from a 2-3 year period and is associated with the deaths of 5 people. The problem is mostly linked to a loose fitting floor mat jamming the accelerator and is recommended that the vehicles in the recall should come into a local Toyota or Lexus dealership and have the non fitting floor mat replaced. Until then it is recommended to remove the driver side floor mat until the owner can get to the nearest dealership for replacement.
Enjoy Today!
Kevin Kimbrough
That Car Guy

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Saturday, July 25, 2009

THE OFFICIAL CASH FOR CLUNKERS WEBSITE

BREAKING NEWS! BREAKING NEWS!

As the official launch of the Cash for Clunkers program is rolled out, please be aware that potentially you could land on a website that may look official, it may be a site that is looking to extract identity information from you or extract money from you. That is why I want to provide you with the official U.S. Government site that will give you all of the info that you should need.

Or visit you local New Car Dealer, who should be well equipped to answer your questions.

Official Site:
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Kevin E. Kimbrough
That Car Guy

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Monday, July 13, 2009

Steve Rattner Is Resigning As The US Task Force Chief

BREAKING NEWS! BREAKING NEWS!
Steve Rattner the US Auto Task Force Chief has announced that he is stepping down after General Motors and Chrysler exit from federal bankruptcy, according to US Treasury Secretary Timothy Geithner.
It is also announced that Ron Bloom, who is a former investment banker and United Steelworkers union official, will replace Rattner, when he steps down.
Timothy Geithner also announced that, " the governments role would shift from restructuring the auto industry to monitoring it."
Enjoy Today!
Kevin Kimbrough
That Car Guy

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Monday, June 22, 2009

Big Money Coming To A Dealer Near You, 'Cash For Guzzlers" Bill Passes The Senate


BREAKING NEWS! BREAKING NEWS!


President Barack Obama will soon sign a $1 Billion Dollar bill, recently passed 91-5 by the U.S. Senate, will provide $3,500.00 to $4,500.00 cash vouchers to consumers who trade in their current vehicles for newer, more fuel efficient automobiles and here is the catcher, the trade-ins must be scrapped.

The bill hopes to provide a push to fuel lagging new vehicle sales in the U.S. auto market, the program will last about 3 1/2 months.

The program has been modeled after similar programs in Germany, France and China, which saw huge sales increases when the programs where released in those respective countries.

I will provide more details of the program as it is released.

Enjoy Today!
Kevin Kimbrough
That Car Guy

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Tuesday, June 9, 2009

The Former Head Of AT&T is Poised To Become The Next Chairman Of General Motors


BREAKING NEWS! BREAKING NEWS!
Edward Whitaker Jr., who is the former Chairman and CEO of AT&T has been tapped to become the next Chairman of General Motors when GM exit's from bankruptcy.
The announcement made today by current Chairman, Kent Kresa, informed the media that he will serve in his current capacity until the new GM exits from bankruptcy, expected later on this summer.
It has been reported that 6 other current board members will retire after the formal approval for the sale of the "Old" GM is transferred to the "New" GM by the U.S. Bankruptcy Court. The new board will consist of 13 members and will be represented by the Canadian Government and the UAW Voluntary Employees' Beneficiary Association.
Edward Whitaker Jr., who was Chairman of AT&T till 2007 holds a industrial engineering degree from Texas technological University and sits on the bards of ExxonMobile Corp. and Burlington northern Sante Fe Corp.
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Kevin Kimbrough
That Car Guy

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Monday, June 8, 2009

Hold On Wait A Minute, Supreme Court Issues A Stay, And Delays Chrysler/Fiat Deal...

BREAKING NEWS! BREAKING NEWS!

Ruth Bader Ginsberg, interrupted the U.S. Government, the new Chrysler and Fiat S.p.A. plans to emerge from bankruptcy court with a fresh start.

The stay issued a few minutes before the deadline, has momentarily delayed the merging of the new Chrysler and Fiat and may derail the deal put together by the Obama Administration to bring new life to the ailing Chrysler.

The Indiana State Pension Fund and other parties requested that the U.S. Supreme Court to review the matter This Sunday and requested that the court rule to stop the sale while the group seeks to challenge the sale of the "old' Chrysler" as the pension group believes they are due far more that what they are receiving from the proceeds of the sale as it is currently structured.

Among the various challenges include, the use of federal bailout funds being used illegally, that the sale unlawfully rewards unsecured creditors ahead of secured creditors which amounts to an illegal reorganization plan.

More to come...

Enjoy Today!

Kevin Kimbrough

That Car Guy


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Thursday, June 4, 2009

What Is Going On With GM Forcing Dealers To Sign Participation Agreements Or Face Termination... What's Next?



As the free enterprise system is turned upside down with the financial meltdown, mortgage crisis, bankruptcies by major corporations, including General Motors, companies across America are being forced into making major cut backs in employees, expenditures and deal with a less than stellar economic forecast in the foreseeable future.

Particularly as General Motors has gone to Washington D.C. with hat in hand and lawmakers and the current administration willfully opening up the taxpayers piggy banks, GM has taken the opportunity through the bankruptcy process to force the hand in it's favor away from many of it's stakeholders.

One of the principle stakeholders that the company has no investment in and cost the company virtually nothing as GM cost shifts at unprecedented rates, is it's dealer body. The remaining dealer body that has weathered tremendous economic conditions over the 100 years of GM existence and persevered through great adversity is now being forced to sign "Participation Agreements" or face franchise termination.

These "Participation Agreements" are requiring the remaining dealers to comply with company upgrade and program requirements that the company requires during the bankruptcy process. The remaining dealers who have received the letters have until mid-June to sign and return the agreements and if the dealers do not comply with the request, General Motors will terminate the existing franchise agreement.

To the outside world this may seem simply as a company requesting an authorized franchisee to do what is in the best interest of the company and compliance should not be questioned. However in the world of auto dealer and auto manufacturing relationships, this becomes a another tool in which a major corporation with the power and might of GM (now backed by the U.S. Government), has a new tool to impose it's will on an independent businessman or woman without regard to market conditions or an assessment of need in a particular dealerships sales area.

The heavy hand of GM dictates need, no questions asked, do this or else seems to be the new corporate by line towards factory and dealer relations. It truly is a sad day for dealers, the individuals, cities and towns that depend on these dealers now have to spend excess monies to fund projects for GM in another cost shifting move to comply with whatever the factory wants, now the independent dealer must do, or else.

The corporate position is firm, Mark LaNeve said in a company statement, "GM expects them (the dealers) to perform well on customer satisfaction scores and sales, have their facilities up to speed and not have any non-GM brands in their showrooms". Dealers should and will expect tough requirements moving forward through this process, I ask, individual markets have significantly different market expectations and no one is giving dealers any bailout or any monies at all. The remaining dealers, many of them are in perilous financial conditions currently and will get even worse if the sales climate does not improve soon.

The big twist in all of this, the biggest glaring clause in the agreement states that the dealer agrees that they will not sue the manufacturer before the dealers franchise agreement expires in 2010.

Our free market system, isn't it wonderful.

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That Car Guy

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Monday, June 1, 2009

Clark Howard Is Wrong About Automobile Distribution Cost...





I heard Clark Howard on the radio this evening (6/1/09) answering a callers question on his radio show about why Chrysler and GM closed dealerships across this country, as the caller did not understand how this cost the manufacturers any money, since auto dealers are independent businesses.
Clark Howard who I find entertaining in his folksy manner and who I believe normally does a good job of explaining topics, by and large I think he gets things right when he explains financial matters to his audience. However, Mr. Howard got this question wrong, dead wrong as a matter of fact.

Clark Howard explained to the caller and his audience that the cost to the manufacturer was tied directly into the inefficient distribution system that was in place when General Motors had 60 percent market share and that the cost to get the vehicle to the dealers cost the manufacturer money by shipping vehicles to all the dealers who were in place when the company enjoyed such a large market share and by comparison the imports sell more cars per dealer but had fewer dealers.
So it cost the import manufacturers less money to ship those vehicles to there dealer network (I am paraphrasing as I do not have an exact transcript). The system was inefficient to the manufacturer and cost it money with many inefficiencies in the current system so it was necessary to reduce the dealer head count to create efficiencies in the distribution system and hence save money for the manufacturer.
Clark Howard you are wrong on so many points but I will start with just the freight, the dealers pay for the freight and do you know that the freight is the same charge for a dealer that is only 50 miles away from the freight yard as it is for a dealer that is 500 miles away, the manufacturer averages the cost and splits it among the dealer body, in addition the cost is paid at delivery. But GM doesn't pay it's freight vendor for 60 - 90 days and in some cases 120 days, how is that for cash flow, most businesses would die for this kind of cash flow.

But the cost to distribute is not entirely based on shipping cost, there is the cost to order and the cost to service the dealers account (manufacturers representative), most dealers are assigned a sales representative since the dealer is the manufacturers customer. But most dealers don't have a personal representative calling on them everyday, they are assigned a telephone number that in turn has a rep assigned to it. These dealers over 60% of the dealer body do not sell enough vehicles (per GM guidelines) to warrant a weekly or monthly visit from General Motors. In addition computers print out recommend orders to the dealers and the dealer accepts or rejects the order or amends it if he wants more or less vehicles. But just because a dealer wants more vehicles does not mean that they will get it, especially of hot items, such as the new Camaro, those request tend to go to the top selling dealers.

Clark Howard did point out that the sales per dealer at import dealerships were higher than those at domestic dealerships, this point is true, but the insinuation that this cost the manufacturer money, that is not true. This cost the dealers money, since the dealer has less opportunity to sell more vehicles and has more competition within his own dealer body to make money per vehicle. More dealers benefit consumers, because if a consumer can shop multiple GM dealerships within a smaller geographical footprint, they, consumers,save money as most same make dealerships cannibalize profits by underbidding the neighboring GM or Ford or Chrysler store. It is highly naive to think that closing dealerships benefits consumers especially on price, most consumers make a vehicle decision online and then they shop that particular brand and make of vehicle and shop same make dealerships. You do not find a person once they make up there mind on a Chevrolet Silverado, comparing prices on a Ford XLT, because the consumer in most cases has made up there mind that they are purchasing a Chevrolet before they step out and shop prices, so they compare competing Chevrolet dealers.

The issue becomes only based on customer service, which he did not point out, if a dealer is not selling more he is making less money and therefore you could make an argument that his expense to provide a high level of customer service is diminished, but even in that example the cost to the manufacturer is zero, zilch, this cost rest solely on the franchised dealership.

So a computer sends out the request and a computer fulfills the request, less manpower over the years to service a large majority of the manufacturers customers, hmm, sounds like the company has figured out a way to save money in the distribution system, lets examine the cash flow portion of this equation.

Clark Howard should have pointed out that dealers pay the shipping cost and the entire cost of the vehicle owed to the manufacturer at delivery. Wow, how is that for cash flow, I am sure that every industrial manufacturer would love a sweet deal like that, but it gets better. The manufacturer is over paid, up to 102-106% (Invoice, hold back, advertising and other built in incentives and shared cost) of the manufacturers invoice to the dealer, what a great system for the manufacturer, all at the time that the vehicle gets delivered on the dealers doorstep. The dealers bank pays those cost up front, without delay. This reminds me of the airlines, oh but I digress, how do you get your cost paid up front without delay and have this kind of positive cash flow and manage to say that the distribution system is costing you money.
But it gets even better, manufacturers by and large are notorious for paying vendors 60, 90, 120 days late, oh and it gets even better, they sometimes go back and renegotiate the cost of supplies to them after they have accepted goods, services and supplies. Yes the automobile manufacturers after accepting delivery, go back and say, well I agreed that I would pay you 'X' amount, but I can only pay you this lower amount, this is said with a heavy hand by the way, and where else is a supplier to go with door panels for a Chevy Impala, GM is it's only outlet.

But it gets even better, I said that the manufacturer is overpaid by the dealer at delivery, so therefore the manufacturer owes the dealer some money. Those monies are paid through separate accounts that the dealer sees the proceeds on when they sell a vehicle or time passes (such as hold back), but these monies are not paid right away they are still being held until the sell takes place to a consumer in most cases. These funds are paid through a weekly account and monthly account, however funds are still delayed by upwards of weeks to months in some cases.

The dismantling of the dealerships by the manufacturer is designed to provide the remaining dealers better profit opportunity so that they can invest in new facilities and upgrade, not to save the manufacturer any money because it does not cost them any money.
The issue really is, the manufacturer wants a dealer body that can make investments that the manufacturer wants as the manufacturer wants them and they need a highly profitable dealer network that can fund these investments.
Yesterday it was announced that the remaining GM dealers must sign a letter that states "that if GM requests the dealer invest in there facility or programs, that they agree to make those upgrades or they will be terminated", how is that for a thanks for assisting us as we go through bankruptcy welcome letter.
In the end consumers will pay more for vehicles as there is less competition from competing same make name plates, this should have been the story that Mr. Clark Howard should have conveyed to his audience, how does it effect the consumer.
I work tirelessly to provide you the real story behind the story, and provide a forum in which I discuss and comment on topics in which the general public is not fully informed about.
Enjoy Today!
That Car Guy

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General Motors Bankrupt! U.S. Government Expected To Take A 60 Percent Ownership Stake


BREAKING NEWS! BREAKING NEWS!


As expected GM filed for federal bankruptcy protection today, in what most analyst agree will be an organized structured bankruptcy process. The federal government is to take a 60 percent ownership stake while the Canadian Government takes a 12.5 percent stake, the UAW has a 17.5 percent stake and bondholders will have a 10 percent ownership stake.

What should be the largest industrial bankruptcy in U.S. history should pave the way for a new GM if the Obama administration plan moves through federal court smoothly as expected.

A Chief Restructuring Officer has been appointed, Al Koch Managing Director of AlixPartners, who steered Kmart through it's Chapter 11 reorganization. Mr. Koch is expected to be the point person in dismantling the "Old" GM (parts, assets, etc.) into the "New" GM, he is also expected to steer the management team assembled to close the "Old" GM when the company emerges from bankruptcy.

The bankruptcy will effect many constituents, including auto warranties (the federal government is currently backing the warranties), retirees pensions, auto suppliers, auto dealerships, shareholders (expect nothing), employee 401k plans and others.

The company should emerge much leaner which should include Chevrolet, Buick, Cadillac and GMC, the companies other brands are expected to be sold off and if buyers can't be found they will be shuttered.

Once the icon of American Industry and the world, GM is far from it's glory days, can it survive and thrive once again, I believe it will, to survive in this current economic crisis, it had to become smaller and leaner and this bankruptcy filing was the only way to get all of it's stakeholders to agree on the restructuring necessary, which includes the Federal government assistance. It would have never survived without the U.S. Government intervening on it's behalf and many more companies would have been brought down with it, including Ford Motor Company.

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That Car Guy

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Thursday, May 21, 2009

Company Says That It Can Produce A 100 mpg Hummer H3, Reality Or Fiction?


Raser Technologies a company operating out of Provo, Utah introduced a hummer that the company claims gets the equivalent of 100mpg. The company along with California Governor Arnold Schwarzenegger and Utah Senator Orrin Hatch was on Capitol Hill Wednesday to introduce the technology to the Obama Administration and the nation.
The Chairman of Raser Technologies, Kraig Higginson indicated that consumers could expect the vehicle available for purchase by 2011.
The company said that it's pricing should be about $55,000.00 when the company starts mass producing the Hummer. The company went on to say that the technology used in the prototype would not be limited to just Hummers, a company spokesperson said that the technology employed can work with a SUV or pick up truck.
Visit: http://www.rasertech.com/ for more information.
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That Car Guy

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The Auto Dealers Are Not The Problem! The Aftermath Of Chrysler and GM closing Dealerships Across America...




The letters landed on dealers desk across America like a ton of bricks, 789 Chrysler dealers and 1100 General Motors dealers out of business, plus another 1000 GM dealers receiving probationary letters, telling them to shape up or they are next.

What has happened to our free enterprise system, the capitalism that brought so much prosperity to this country, this has now become my battle cry. Bankruptcy courts are forcing independent business men and women to loose millions with a stroke of a pen without a hearing or opportunity to plead there case, what has happened to due process. Why aren't auto dealers getting a day in court, like any other creditor, dealers are owed billions in rebates, warranty work, incentives, parts credits, not to mention that all dealers have a valid contract that states that the manufacturer will repurchase all of the dealers remaining inventory if the dealer loses his or her franchise due to termination and other matters.

Earth to our U.S. Government, you terminated the dealers franchise agreements and then a bankruptcy judge terminated all dealer agreements, auto dealers deserve a hearing and no one is listening, they have valid claims in this bankruptcy proceedings as they are owed money just like everyone else standing in line in this meltdown.

However, what concerns me most is our U.S. Government said that they wanted to preserve jobs, yet they single handily in one letter, terminated upwards of over 100,000 (est.) people directly involved in the process of selling and servicing auto dealers on behalf of the manufacturers. These folks were not the problem, they were in essence part of the solution in retailing millions of vehicles over the years. No question that the domestic dealer body had to many dealers in many markets and same make brands cannibalized each others profit opportunity, but the manufacturers created the environment and men, women and families invested heavily in obtaining and financing these businesses. Real people in towns and cities across America are employed by these dealerships, communities rely on the tax base that these stores provide, softball teams and schools and other charitable organizations have come to rely on these enterprises for support over the years.

But what has baffled me the most is who is going to service the people who purchased many of the vehicles that these dealers sold? Although not announced, a service network of some major chain has to fill the void, you can't leave auto owners high and dry if a vehicle breaks down and the nearest dealer is 30 - 50 miles away in some cases, why isn't a comprehensive plan in place to answer the fears that some car owners have, announce the service centers who will provide the ongoing warranty work at the minimum.

An ongoing debate between dealers and domestic auto makers has been going on for years and implementing a plan to reduce dealers certainly cost money, but these dealers have served the manufacturer and there customer base well, most are profitable even if marginally in the current market. Many have sold vehicles exclusively with one make for generations and are stewards in there communities, attrition will take care of the weak and advancing market conditions will take care of the remainder.

Auto makers have many bigger issues to address, getting their own house in order should be at the top of that list, not putting independent businessmen and women and there employees out of business shouldn't be at the top of that list.

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That Car Guy

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Monday, May 4, 2009

A Question For That Car Guy...



QUESTION?- I keep thinking that this is an idea who’s time has come. What do you think the pros and con’s are? http://www.autobloggreen.com/2009/05/02/hondas-fuelmaker-finds-a-new-home/


ANSWER- The issue behind natural gas (CNG) is the infrastructure, much like electricity and matching the refueling with demands when people are traveling or general commuting. The money, time and effort that it cost to build the necessary infrastructure is enormous and no one has been able to accurately amortize the timeline when it will be profitable based on the current low demand and lack of real interest. South America clearly has resolved the infrastructure issue and demand for CNG and biofuels as the governments adapted policies quite some time ago.


I believe developing countries could use a program like the home refueling system that you shared, those countries that still lack infrastructure and I bet that the company that purchased the system has underdeveloped nations in mind, because if Honda can't make it work (it's focus is on developed nations) it did not have a market or they felt they could not develop a market in a quick enough time frame.


CNG has had government support for utilities for years and it still has not gained enough traction within the commercial area, large subsidies to other businesses who could purchase trucks outfitted or retrofitted to burn CNG also, but the effort has gone nowhere, mainly because of the refueling issue. Americans by and large are unwilling to give up luxuries that they have been used too, CNG and biofuels vehicles do not enjoy the same horsepower and torque that gasoline powered vehicles have in the current form. Companies are working on improving horsepower and performance to match gasoline.


The real issue becomes what alternative fuel (CNG, BioFuels, Clean Diesel, Electricity, Fuel Cell, Hybrid program etc...) will our government support in creating the necessary refueling stations that are needed. I like Fuel Cell technology as a power source but the infrastructure necessary is way to high. By and large our nation travels great distances and in many communities it is necessary, we aren't a nation that has short commutes and most of our population centers are not densely populated so people have to travel longer distances daily, especially in middle America. It will be hard for folks in the midwest down to Texas to give up there large SUV's and Trucks when that is the comfort level and demands needed to accomplish those families daily needs. Americans still have an appetite for larger vehicles, imagine traveling from Indianapolis, to Chicago in a Smart Car, that vehicle works for a city commute but if that is your main vehicle do you really want to travel 200 miles in that vehicle.


I believe Electricity is the way that I see our country going, electric vehicles can have great torque and horsepower and reach speeds quickly, the infrastructure needed to put recharging stations in current gasoline stations or building a recharging station (these can be unmanned) is simpler than putting in new bio fuel tanks, new diesel tanks or CNG storage tanks. Plus I believe our public sees electricity as greener, although that is perception, the output from the vehicle is clean, however the process to produce the electricity is not clean, most comes from coal, in addition, the wasted batteries will become a disposal issue, but with most things the perception will sell it.


There is a program that is gaining some press and might have legs, check out http://www.projectbetterplace.com/ this company has a radical new take on vehicle purchases and refueling. The company views vehicles much like the cell phone industry views cell phones, where the money is in the service (batteries and refueling) not the physical product. Check it out and I would be interested in your feedback.

Enjoy Today!
That Car Guy

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Thursday, April 30, 2009

BANKRUPT! CHRYSLER CORPORATION IS FILING FOR BANKRUPTCY PROTECTION!

BREAKING NEWS! BREAKING NEWS!
Chrysler LLC is filing for Chapter 11 bankruptcy protection as announced by President Obama today at a Press Conference.
As expected from what has become daily speculation, President Obama has made the following statement, "Over the past month, seemingly insurmountable obstacles have been overcome", "Chrysler and Fiat have formed a partnership that has a strong chance of success", in a televised broadcast.
Talks between key stakeholders of the company broke down when certain creditors were holding out from the latest government offer of swapping the debt for $2 billion dollar, the government then increased the offer to $2.5 billion and were given a Wednesday deadline at 6pm.
The President went on to say "Their failure to act in either their own economic interest or the national interest does not diminish the accomplishments made by Chrysler, Fiat and it's stakeholders, nor will it impede the new opportunity Chrysler now has to restructure and emerge stronger going forward."
The terms of the partnership between Chrysler and Fiat although not entirely clear, are summarized as follows: 1. Fiat would gain entry into the U.S. automobile market 2. Fiat would have a minority stake in Chrysler ( this would be for a technology exchange, so that Chrysler can make make small auto's) 3. Chrysler would gain access to other global markets that it does not have currently 4. This deal provides no monetary exchange between the two companies.
GM has until June 1, 2009 to have a solid plan in place or it will be forced with the same fate. GMAC and Chrysler Financial it appears will merge under this reorganization plan and these talks are ongoing.
Enjoy Today!

That Car Guy

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Wednesday, April 1, 2009

Loose your job, GM and Ford say no problem, we’ll make your car payment...




Following in the footsteps of Korean automaker Hyundai, General Motors and Ford Motor Company, made announcements March 31, 2009 that it would make the car payments for customers who lose their jobs, up to 12 months.

Hyundai Motor Company has had a similar program since January, 2009 and states that its sales have risen 4.9%, its program initially stated that customers could return the vehicle without damaging the customer’s credit. It has since made a temporary change that states that Hyundai will make up to three months of car payments (leases and loans).

General Motors program called GM Total Confidence Program will provide payment protection for two years. The program will make nine vehicle payments of up to $500.00 a month for its new vehicle purchasers on vehicles purchased by April 30, 2009.

Ford Motor Company announced its Ford Advantage Plan that will make vehicle payments up to 12 months with a maximum payment amount of $700.00. Customers must purchase a vehicle by June 1, 2009 and the program will accept claims until December 31, 2009.

General Motors made an additional announcement regarding Trade-In protection to customers who sometimes end up owing more on a vehicle than its current value. GM said that it would provide limited trade-in protection on GM vehicles purchased with a finance contract up to six years and would further require that customer to be midway through the contract before the trade takes place. In a further major move GM began touting its 5 year/100,000 mile powertrain warranty as the “best coverage in the industry”.

General Motors is not stating that the government recently announced that it would back the warranties of its vehicles, should the company go into bankruptcy. Mark LaNeve, GM vice president of North America vehicles sales, service and marketing stated, “We’re not using the word government or using that level of detail” were just stating that the warranties are “fully backed”.

Ford is confident that the new program along with its current line of 0% financing offers on most of its vehicle line up will shrink sales declines in recent months as stated by John Felice, General Manager of Ford, Lincoln and Mercury. He went on to say that the current offer is low risk by Ford, which is buying insurance to cover potential payouts, he would not disclose the cost of the program but described it as nominal.

These programs are anticipated to bring confidence back into dealers’ showrooms and resuscitate life back into the ailing auto industry. GM and Chrysler have 60 and 30 days respectively to provide the Federal Government satisfactory plans to turn around its companies or face bankruptcy. The lifeline that they have lived on for the last few months has tightened considerably and is near being completely cut off.

The automakers immediately began touting the programs online and consumers should start to seem them in print and radio in the next couple of days. For complete details of these programs check the company websites and ask dealers for a complete copy of these programs so that consumers maintain any compliance issue.

Enjoy Today!

That Car Guy

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Monday, March 30, 2009

Rick Wagoner Is Ushered Out The Door At General Motors... Gone, Outta Here, No More...

BREAKING NEWS! BREAKING NEWS! BREAKING NEWS!

General Motors Chairman and CEO Rick Wagoner stepped down over the weekend as the United States Government mounted unprecedented pressure on the CEO and automaker that it's proposed turnaround plan did not go far enough in it's bid to restructure the automaker.

In what many view as a forced departure of the CEO by the Obama administration many view it as what may come of top CEO's who have received federal monies and who appear to not have clear ideas and plans on how the taxpayers will get a return on the Billions of dollars that have been provided to keep these failed companies afloat.

Rick Wagoner, 56 , who has run the company since 2000 and has worked for GM for 32 years issued a statement that he is stepping down immediately and Fritz Henderson will be come CEO. Fritz Henderson had been the company's Vice Chairman and COO. It is being reported that many of the GM board members will step down and new board members are expected to join the company board soon.

The Obama administration is showing some seriousness in making sweeping statements that it wants fundamental changes at many of these companies who have received federal bailout dollars. The American public has been quite vocal and angry about the continued flow of monies to troubled company's and are saying loudly enough is enough.

Wagoner gets credit for steering the company through some very troubled times and closed Oldsmobile and reduces GM's workforce from 177,000 people when he arrived to 92,000 today and among other cost cutting measures, However clearly the efforts were not enough, as the company has lost over $82 Billion dollars since 2005.

Enjoy Today!

That Car Guy





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Tuesday, February 17, 2009

General Motors And Chrysler Are Back To Begging For More Money...




BREAKING NEWS! BREAKING NEWS!

The Big 3 Automakers were back begging for more bailout money from the U.S. Government and filing restructuring plans to support there efforts. Ford it should be noted has not requested any funds to survive, although it says it would need funds if GM or Chrysler should fail.
General Motors has requested $16.6 Billion dollars and Chrysler has submitted a plan calling for $5 Billion dollars and indicate that thousands more jobs will be lost there hands are out.
Chrysler projects the U.S. auto market will sell only 10.1 million vehicles the lowest output in 40 years, which is less than the 11.1 million units that it predicted when they received there first loan from the Treasury. This lower forecast is in line with the reason why they have increased the amount of additional funds that they indicated is need to keep the automaker afloat.
Chrysler also announced that it will eliminate the Chrysler Aspen, Dodge Durango and PT Cruiser models from its line up. In addition it announced that the company will comply with the Federal Governments guidelines in reducing executive compensation and stated that it had eliminated company matching employee 401(k) plans and many other cost cuts.
Chrysler further made proposals to sell over $300 million dollars in "non earning assets" in 2009 and states that it will begin paying back the loan beginning in 2012. The proposal was contained in 199 pages that it submitted to the Treasury and included what the company would due should it face bankruptcy.
General Motors, Ford and Chrysler as indicated by the release of a statement from the UAW union has reached tentative agreements on making changes to the 2007 labor contracts. The UAW also stated that ongoing talks are still going regarding funding retiree health care obligations that the union has agreed that it would take over next year.
General Motors is in desperate need of $16.6 Billion dollars and may need upwards of $30 Billion dollars in government loans as it submitted its restructuring plans to the Treasury Today (2/17/09). The plan includes eliminating 47,000 jobs and closing 5 more U.S. factories. The company is also planning on eliminating or selling its Saturn, Hummer and Saab brands.
Commentary: I see a future in which the U.S. will not be manufacturing any or very very few so-called American brands here in the states, the cost to manufacture vehicles with labor cost and other monetary factors make the cost to high and you can't build a business case to support it, when the U.S. is competing with other countries who's labor cost are considerably less than the U.S.. Any business model that makes since has many factors to consider and importing these vehicles from countries that have lower labor cost and are emerging as industrial centers will become standard within the next 6-10 years.
I will report on the GM plan as I research the plan more thoroughly.
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That Car Guy

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President Obama Signs Stimulus Bill into Law...

BREAKING NEWS! BREAKING NEW!
With the stroke of a pen, $787 billion dollars will be spent in the U.S. economy over the next few years. President Barack Obama signed into law Today one of the largest spending measures in the history if the United States.
The President spoke to a large crowd in Denver, CO, stated that Americans to begin "laying claim to a destiny of our own making", before the bill signing ceremony.
The White House also opened up a website http://www.recovery.gov/ that will provide the country a mechanism to keep track of where and how the money from this bill will be spent. This was done as a measure of transparency that President Obama has pledged to maintain.
Even with unprecedented measures to pump money into financial institutions and American automakers, the country is reeling from continued slow growth and massive layoffs. In addition, State governments and municipalities across the country are struggling to meet common services and in some cases refunds to taxpayers.
The country has an unemployment rate is at a 16 year high at 7.6% and Economist and other analyst predict that the overall economy will remain unstable throughout the rest of the year.
The bill includes many measures that provides tax breaks and spending projects that as proposed should put millions of workers back to work.
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That Car Guy

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Tuesday, February 3, 2009

There Back! The United States senate voted to make Auto Loan Interest and Sales Tax Deductible on Income Taxes...


BREAKING NEWS! BREAKING NEWS!
The United States Senate voted today to allow automotive loan interest and sales taxes on vehicle purchases deductible on federal income taxes, a move that has not been around since 1986. The proposal that has been pushed forward by the National Automobile dealers Association (NADA) was added to an economic stimulus bill that had been under major debate in the Senate, the final vote tally was 71-26.
This provision that was not in the original version passed in the House bill, that version had more than $800 Billion Dollar package of spending increases and tax cuts.
A conference committee still has to decide whether the provision stays or goes, the bill is a top priority of President Obama's stimulus package. The bill if passed by the House and the Senate will allow deductions on interest and taxes on auto loans for the first time since 1986.
The NADA states that the measure will provide consumers to save on average $1500.00 on a $25,000.00 vehicle.
Enjoy Today!
That Car Guy

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