Automotive News - December 8, 2008 - (Page 26) 26 • DECEMBER 8, 2008 final assembly comment CRISIS IN DETROIT >> For dozens of stories on the Detroit 3 rescue efforts, see autonews.com/bailout Saturn founder Neil DeKoker still believes N ews that General Motors may sell or close Saturn seems such a small part of the ongoing apocalyptic drama — except to Saturn dealers and people like Neil DeKoker. DeKoker, founding president of the Original Equipment Suppliers Association, was part of the Group of 99 — salaried and hourly GM employees who gave Saturn its personality, character and brand DNA nearly a quarter of a century ago. He told me last EDWARD LAPHAM week that he’s IS EXECUTIVE shocked and EDITOR OF AUTOMOTIVE dismayed at NEWS. Saturn’s fate. “We came together to create a new world order,” said DeKoker. In early 1984 he joined the group that visited GM and competitive factories around the world. The group benchmarked the best in manufacturing, marketing, sales and human relations. Central to the Saturn vision was eliminating the animus between management and labor so all parties could work together as teammates and co-owners. Obstructive work rules disappeared. Communication improved. And UAW workers agreed to work for 20 percent less than base pay at other GM plants, but with bonuses for meeting performance goals. DeKoker left GM to become a vice president of Magna International on Aug. 1, 1985, just after it was announced that Spring Hill, Tenn., would be the Saturn plant site. By then, the Group of 99 had developed the guiding principles, shaped the business model and hammered out the historic Saturn labor agreement. He wasn’t around for Job 1 or the early marketing and sales successes with customer-friendly practices. In the 1990s, the vision of making Saturn a world class entry-level vehicle went sour. GM choked off product development funds, and Steve Yokich, by then head of the UAW, torpedoed the unique partnership, not to mention the original mission of the Group of 99. Why 99? It was originally a group of 100, said DeKoker, but one UAW member thought Saturn was a GM plot to co-opt the union. He walked out in a huff. GM is about to follow that guy’s example. Some things never change. LaNeve: Death talk keeps the showrooms empty I s the smell of death keeping customers away from General Motors showrooms? “There’s not a doubt in my mind,” Mark LaNeve, GM’s vice president for North American sales, said last week. That’s consistent with analysts who say a Chapter 11 filing would doom an automaker. They say shoppers likely wouldn’t spend $20,000 or more on a product whose maker might not be around to handle warranty work. It’s known as the “orphan syndrome.” Talking with reporters, LaNeve cited a report by CNW Marketing Research Inc., of Bandon, Ore., that 20 to 30 percent of new-car shoppers are avoiding Detroit 3 brands because of negative news about the Detroit 3’s financial health. “It could be higher,” LeNeve said of the CNW report. GM sales plunged 41.3 percent in November compared with November 2007, while the entire market was down 36.7 percent. Foes of federal aid to automakers say a governmentsupervised bankruptcy is preferable, but LaNeve said GM has no Plan B that involves Chapter 11. “There’s not a plan in the company that I know of that deals with bankruptcy,” he said. “We don’t think any plan in that regard is viable.” LaNeve: GM has no Plan B for bankruptcy. JOE WILSSENS Auto blowout sends Andrettis to the pits And then there were . . . 6? T S ure, auto racing was dangerous. But selling cars? That’s really risky these days. So the black flag has come down on the Andretti family’s auto retailing venture. Mario and Michael Andretti, the legendary father and son racing duo, have closed their Chrysler-DodgeJeep store in Vermilion, Ohio, the last of the three dealerships they operated in Ohio and western Pennsylvania. “The business was still profitable,” said Mike Clapham, the store’s general manager. “But they could see trends developing, and they decided to cut their losses and pull out.” In 2007, the dealership reported 337 new-vehicle sales, 1,215 fleet sales and 337 used-car sales. The loss of leasing, Chrysler’s dealer consolidation efforts, and the LYLE STAFFORD/REUTERS Father-and-son racers Michael and Mario Andretti are out of auto retailing. uncertainty in the auto industry contributed to the Andrettis’ decision, Clapham said. The Andrettis sold the franchise back to Chrysler as part of the automaker’s dealer consolidation. he global auto shakeout is likely to leave only six major automakers standing two years from now, according to Fiat’s CEO. “By the time we finish with this in the next 24 months, as far as mass-producers are concerned, we’re going to end up with one American house; one German of size; one French-Japanese, maybe with an extension in the U.S.; one in Japan; one in China; and one potential European player,” Sergio Marchionne told Automotive News Europe. “The only way for companies to survive is if they make more than 5.5 million cars per year,” he said. At present, only five automakers — Toyota, General Motors, Volkswagen, Ford and RenaultNissan — have that kind of scale. Marchionne said: “Independence in this business is no longer sustainable.” THE FINAL SAY I feel violated. Just a couple of weeks ago they were telling us how viable Saturn was to General Motors. — George Nahas, who owns two Saturn stores in Alabama and Florida. Nahas owned only an Oldsmobile dealership when GM announced in 2000 it would kill the brand. So he moved on — to Saturn. “ Detroit 3 road trip: Quiznos and humble pie whole thing up. It fantasized online With multibillion-dollar issues on the table and thousands of jobs what the conversation might have on the line, there was still time last been like if Wagoner, Alan Mulally week for a little Kabuki theater. In separate caravans, the Detroit 3 CEOs made 525-mile road trips to Washington to avoid a repeat of the thumping they took two weeks earlier, when they rode corporate jets to town in search of a handout. Fox News staked out Rick Wagoner’s home at 5 a.m., netting only a 6:30 interview of nothingspeak before filing a breathless report. News reports were jam-packed with microeconomic analysis — $30 in tolls, $1.70-a-gallon gasoline, lunch (in Wagoner’s case, at Quiznos) — compared with $20,000 or so for a corporate jet ride. There was investigative and Bob Nardelli had carpooled. Some snippets: Nardelli: “Damn, Mulally, why don’t you just pick a (radio) station and be done with it? I’m trying to concentrate here.” Mulally: “What, Sudoku on your laptop? Yeah, I guess that would be a challenge for the genius who came up with the Dodge Caliber.” They stop for snacks. Wagoner: “Just get me a Red Bull and some pate.” Mulally: “Slim Jim and a bottle of Pellegrino.” Nardelli: “How about kicking in, guys? I’m only making a dollar a year now.” ” JONATHAN ERNST/REUTERS Chrysler CEO Bob Nardelli arrives to testify on Capitol Hill. journalism, too: The Associated Press tattled that Wagoner’s hybrid caravan “routinely exceeded the speed limit by about 5 mph.” The most entertaining account was by New West, a Missoula, Mont., media company, which just made the Toyota cuts bonuses in bid to stay in the black Edward Lapham writes commentaries each week for autonews.com. Read them at autonews.com/edwardlapham. or the first time in a decade, Toyota is trimming year-end bonuses for middle and senior managers as it races to rein in costs. But unlike its deep-in-the-red Detroit 3 competitors, Toyota is cutting in an effort to keep the company in the black next year. About 8,700 employees are affected. It’s the first time Toyota has reduced bonuses since 1998, company spokesman Paul Nolasco said. He declined to say how much the cuts will save. Toyota cut the payments after reporting last month that global operating profit will plummet 73.6 percent to $5.83 billion this fiscal year. That would be Toyota’s lowest operating profit since 1998. President Katsuaki Watanabe is now chairing an “emergency profit” committee to stop the bleeding and make sure Toyota stays in the black in 2009 and 2010. http://www.autonews.com/bailout http://www.autonews.com http://www.autonews.com/edwardlapham
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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