Automotive News - December 8, 2008 - (Page 1) autonews.com ® DECEMBER 8, 2008 Entire contents © 2008 Crain Communications Inc. All rights reserved. $155/YEAR; $5/COPY Feds tighten strings on Detroit 3 Crisis coverage Pain for all As sales collapse, Toyota and Honda are not immune. Page 3 Chrysler CEO Bob Nardelli: “Hollowed out” company is restructuring to survive. REUTERS Bailout terms could include oversight board, bankruptcy deadline; GM-Chrysler tie-up? Harry Stoffer hstoffer@crain.com Big question Congress: Why should taxpayers bail out Chrysler? Page 8 Rx for industry Steve Miller: Detroit 3 need “out-of-court pseudo-bankruptcy.” Page 8 Global 6? Fiat CEO: Worldwide shakeout will leave only 6 major automakers. Page 26 ROGER WOLLENBERG/UPI Last week, GM CEO Rick Wagoner rode in a test vehicle equipped with a Chevrolet Volt plug-in hybrid powertrain to testify on Capitol Hill. With him are U.S. Sen. Carl Levin, center, and Rep. Sander Levin, Michigan Democrats and brothers. WASHINGTON — If the Detroit 3 win approval of $34 billion in emergency government loans this week, they also will get painful conditions. Members of Congress are suggesting a headspinning array of strings on the loans ranging from a shotgun marriage of General Motors and Chrysler LLC to limits on the companies’ lobbying to a deadline for a bankruptcy filing. At congressional hearings last week, lawmakers of both parties proposed giving a federal official or board far-reaching authority to mandate terms of the Detroit 3’s restructuring. That power would extend to rewriting contracts with lenders, hourly employees, dealers and suppliers. It might even force GM and Chrysler to become one company. This fall, the automakers discussed a GM acquisition until they were overwhelmed by their cash-flow crises. Late last week, some lawmakers appeared willing to lend the automakers enough money to keep them alive until next month, giving Congress and President-elect Barack Obama more time to find a way to pay for the bailout. A possible compromise: Congress could draw half the bailout money from its $25 billion fund for development of fuel-efficient vehicles and see STRINGS, Page 24 Saturn: Not dead yet? GM cuts off new product funds as execs mull brand’s future Jamie LaReau jlareau@crain.com DETROIT — As General Motors executives weigh the future of the disappointing Saturn division, GM is not allocating new money toward future Saturn products, according to a source familiar with GM’s budget. In a plan submitted to Congress last week, GM said it would “explore alternatives” for the Saturn brand, which has “performed below expectations.” GM’s plan says the company will focus “substantially all of its product development and marketing resources” to support its Chevrolet, Cadillac, Buick and GMC brands. Saturn’s next scheduled substantial new-product change is a freshening of the Aura sedan in 2010. GM executives have been disappointed with Saturn’s weak sales in light of its strong new vehicle lineup. But although GM isn’t sure what to © GM CORP. Saturn Aura sedan: Is the 2007 North American Car of the Year headed for extinction? Saturn’s franchise agreement ➤ 24 do with the brand, GM is not ready to give up, insists Mark LaNeve, GM vice president of North American vehicle sales, service and marketing in an interview with Automotive News. Saturn can’t be sold, and closing the division could cost cash-strapped GM more than $1 billion in dealer buyouts alone. Saturn’s Franchise Operations Team — a council of eight dealers — will meet with Saturn and other executives Thursday, Dec. 11, and Friday, Dec. 12, in Detroit to discuss how to make the brand profitable, a Saturn spokesman says. Saturn declined to make General Manager Jill Lajdziak available for this story. “Saturn has a product program, both current and future, that is currently in our plans,” LaNeve says. “But a lot of what is in our plans is in a state of flux right now given the state of the economy and everything.” CEO Alan Mulally tries to distance Ford from GM, Chrysler. Honda Civic sales have shriveled. Ford stance: A cut above ailing rivals Amy Wilson awilson@crain.com Summer sizzlers are fall’s fizzlers When gasoline topped $4 a gallon, sales of small cars soared. But with pump prices down by more than half, those models are hibernating. | PAGE 3 | Saturn’s future GM hopes to conceive a new business model to make the brand profitable, LaNeve says. Saturn is not a candidate for sale because it has no dedicated manufacturing or engineering facilities apart from GM, according to another source. And if GM terminated the brand like it did Oldsmobile in 2000, state franchise laws would protect the 211 dealers who own 425 Saturn dealerships. Dealer George Nahas has been through the brand-closing trauma see SATURN, Page 24 NEWSPAPER DETROIT — Here’s a big challenge for Ford Motor Co. as it seeks federal aid: Avoid the stench of death that surrounds crosstown rivals General Motors and Chrysler LLC. Ford is losing billions of dollars, and its sales have plunged nearly 21 percent this year. So executives are struggling to convince the public that Ford is Detroit’s healthy company. Ford’s biggest advantage is that CEO Alan Mulally mortgaged most of the company’s assets in 2006, giving it available cash of nearly $30 billion. That means that, despite losing $8.7 billion so far this year, Ford says it can survive 2009 if industrywide U.S. sales are 12.2 million. There’s more at stake for Ford than see FORD, Page 24 ‘Survival mode’ for dealer in L.A. For years, first-generation Korean Americans flocked to Dai Ryoung Lee’s Los Angeles dealerships to buy cars. How times have changed. | PAGE 4 | On the Web This week at www.autonews.com: All week: Follow the Detroit 3’s quest for $34 billion in U.S. aid. Wednesday: Is Toyota still the best at winning back buyers? J.D. Power’s annual Customer Retention Study is released. http://www.autonews.com http://www.autonews.com
Table of Contents Feed for the Digital Edition of Automotive News - December 8, 2008 Saturn: What's next? Feds tighten strings on Detroit 3 Ford stance: A cut above ailing rivals Summer sizzlers fizzle in fall Dealers back Detroit 3 aid, want spiffs Ford modifies pricing promo to equalize rebates High-fliers Toyota, Honda are struggling, too Chrysler: Bankruptcy counsel supports its stance Dealer Hecker hospitalized Ford to add a shift, OT for F-150 Koreatown dealer scrambles to hang on in L.A. Nissan bucks trend, will move to bigger trucks Why GM must stay with Buick Mercedes prices new GLK below $35,000 Diana T. Kurylko Pride of Sweden set to be Detroit castoffs Toyota pushes breakup of seat suppliers to boost competition Panel to discuss innovation, sustainability Capitol quandary: Can Chrysler survive? Steve Miller: Detroit 3 need 'pseudo-bankruptcy' Acura aims to deliver big-league luxury TL campaign is important for Acura's ad shop, too Appeals court upholds franchise termination GM loses bid to relocate Chevy store This is a very big week for America Obama must steer clear of state fuel standards Higher fuel taxes are not the answer A $15,000 rebate, not a blank check Chrysler retirees look for equality Isn't an auto show a place to sell? Are we turning our back on diversity? If only we'd had an energy policy Personnel GM sets Jan. 1 deadline for dealers to adopt Windows-based parts system Ford picks TRW steering system Ford cuts noise with windshields Dealers, factories battle over Fla. warranty law Online systems boost accessories sales Mercedes cuts output in Ala. Ford will kill Sable, Taurus X November sales suffer car wreck Honda, Audi pull out of racing series Saturn: A different kind of franchise agreement Fewer days sink Nov. output Detroit 3 road trip: Quiznos and humble pie LaNeve: Death talk keeps the showrooms empty Toyota cuts bonuses in bid to stay in the black Auto blowout sends Andrettis to the pits Saturn founder Neil DeKoker still believes And then there were . . . 6? Dealers Automotive News - December 8, 2008 Automotive News - December 8, 2008 - (Page Intro) Automotive News - December 8, 2008 - Ford stance: A cut above ailing rivals (Page 1) Automotive News - December 8, 2008 - Ford stance: A cut above ailing rivals (Page 2) Automotive News - December 8, 2008 - Chrysler: Bankruptcy counsel supports its stance Dealer Hecker hospitalized (Page 3) Automotive News - December 8, 2008 - Nissan bucks trend, will move to bigger trucks (Page 4) Automotive News - December 8, 2008 - Nissan bucks trend, will move to bigger trucks (Page 5) Automotive News - December 8, 2008 - Panel to discuss innovation, sustainability (Page 6) Automotive News - December 8, 2008 - Panel to discuss innovation, sustainability (Page 7) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8a) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8b) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8c) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8d) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8e) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8f) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8g) Automotive News - December 8, 2008 - Steve Miller: Detroit 3 need 'pseudo-bankruptcy' (Page 8h) Automotive News - December 8, 2008 - TL campaign is important for Acura's ad shop, too (Page 9) Automotive News - December 8, 2008 - GM loses bid to relocate Chevy store (Page 10) Automotive News - December 8, 2008 - GM loses bid to relocate Chevy store (Page 11) Automotive News - December 8, 2008 - Chrysler retirees look for equality (Page 12) Automotive News - December 8, 2008 - Chrysler retirees look for equality (Page 13) Automotive News - December 8, 2008 - If only we'd had an energy policy (Page 14) Automotive News - December 8, 2008 - If only we'd had an energy policy (Page 15) Automotive News - December 8, 2008 - Ford cuts noise with windshields (Page 16) Automotive News - December 8, 2008 - Online systems boost accessories sales (Page 17) Automotive News - December 8, 2008 - Online systems boost accessories sales (Page 18) Automotive News - December 8, 2008 - Online systems boost accessories sales (Page 19) Automotive News - December 8, 2008 - Online systems boost accessories sales (Page 20) Automotive News - December 8, 2008 - Ford will kill Sable, Taurus X (Page 21) Automotive News - December 8, 2008 - Ford will kill Sable, Taurus X (Page 22) Automotive News - December 8, 2008 - November sales suffer car wreck (Page 23) Automotive News - December 8, 2008 - Saturn: A different kind of franchise agreement (Page 24) Automotive News - December 8, 2008 - Fewer days sink Nov. output (Page 25) Automotive News - December 8, 2008 - And then there were . . . 6? (Page 26) Automotive News - December 8, 2008 - And then there were . . . 6? (Page 27) Automotive News - December 8, 2008 - And then there were . . . 6? (Page 28)
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