Have auto makers kept pace with product improvements?

Well, it's official. The Feds announced a new nationwide fuel economy and emissions mandate for cars and trucks. While we certainly welcome vehicles that get better mileage, it made me wonder about just how eager the auto manufacturers have been to make it a reality. Virtually every product that we use evolves and improves over time. Here are some examples: the first computers that took up entire rooms and were as slow as a plow horse are now laptops. Cell phones. Remember the 5 pound milk carton that had a range of about 10 miles and the console models in cars? How much have they changed in 5 years? The television used to be a black and white 15 inch, tube blowing, temperamental monster. Today it's a flat screen mounted on the wall with a 50 inch screen! How much more efficient have home heating furnaces become? They are now smaller in size and use less fuel. Now let's take a look at the internal combustion engine. While it has certainly improved from the 1920's, it sure hasn't kept pace with its contemporary inventions has it? One could argue that fuel injection has really been the most outstanding improvement. Now don't get me wrong, between 1975 and 2005 auto emissions have improved by leaps and bounds. Did the brilliant folks that improved computers and cell phones have no counterparts in the auto industry? Makes you wonder, doesn't it? GM has developed one of the most dynamic new engines in decades. It is an all new design with nearly 35% fewer parts. It is a diesel V-8 that can deliver excellent fuel economy and meet the most stringent emission standards. In the US the word "diesel" does not equate with "normal". I read a comment from one of the lead engineers on the project. His hope was that his revolutionary design would be welcomed as a great ENGINE and not as just a low volume diesel. This engine was scheduled to go into production this year. In light of GM's financial problems and wonderful guidance from their new majority owner, the Government, the motor has been shelved! I'd like to hear from that design engineer today. Just makes me wonder what if??????

Chrysler shows no respect for terminated dealerships

As a kid I can remember getting excited when the UPS truck pulled up. This past Thursday, UPS brought envelopes to all of the Chrysler dealerships in the country. One said "welcome to the new Chrysler" and one said goodbye. Who knows, maybe they were even color coordinated or labeled like Publisher's Clearing House with the words "You may have WON!" Can you imagine pulling the zip cord on your UPS letter and finding your fate in a letter? The termination list was released to the media BEFORE some dealerships got their envelope. Dealerships were getting calls from clients informing the dealer that they were closing before the letter came! What a way to conduct business. Think about everything that a hometown dealership does for their community: tax base, employment, community service, donations, sponsorships and so much more. Great job Chrysler. You've got a great ally with the federal government telling you what to do despite having no automotive knowledge. I have a great friend who got the goodbye letter. He really put the situation into perspective when he said: "you know, I'm sitting in my dealership, still stunned from the letter. I had really expected the termination, but you know what? The new Chrysler is owned the the Federal Government and the send my letter via UPS! They don't even use their own government postal service to do their dirty work!" That says it all. You could have done it the right way with honor and dignity. Chrysler chose a scuzzy way to do business!!!

GM headed to Chapter 11?? Top execs sell all stock.

Expect GM to file chapter 11 bankruptcy in June. When many of your top executives sell all of their stock, the writing is pretty much on the wall! I just can't fathom the implosion of both Chrysler and GM. Is it possible that every ranking executive at these corporations was so out of touch with reality? I can give you a little insight. When I was a GM dealer, I had a district manager who became a high level member of the corporation. Even though he had become a big time exec, he continued to call me from time to time for what he called "REALITY CHECKS". He would always wonder what was happening in the real world, away from Detroit. I remember one call where he related how livid he was at a comment made by then Chairman Roger Smith. When Smith was asked how GM was going counter the announcement of the Dodge Neon, Chrysler's ill-fated attempt at making a quality, low cost small car, he made the following statement. " Our best competition for the Neon is a used Buick." How telling was that mentality? One could guess that the desire to saturate the market with high profit SUV's was the golden egg that GM thought would never cease to be. Oops. Reality Check Time. I never thought that I would ever witness that less than a 50 cent drop in the price of a GM share of stock would represent a drop of over 20% of its value! The sad fact is that it's going to get a whole lot worse before it gets any better. The Federal Government will see to that.

Will GM become Government Motors?

It's not very comforting to read that our federal government seems to think that they have the expertise and all of the solutions for General Motors. I'm sure that there is a lot of blame to go around for all that ails GM, but bureaucrats with no auto experience are NOT the ones who should be calling the shots. When will it all end? Chrysler is in turmoil and GM is in the on deck circle. The folks at Ford have to be thrilled that they turned down the bailout money with all of it's suffocating restrictions. I don't think that there is any doubt that Ford will become the strongest domestic automaker! It took a lot of pride for the Ford family to give control to an "outsider" and charge him with remaking the culture of the corporation. Mr. Mullally took the reins and rooted out the waste and the paralyzing multi-levels of management to make a product and consumer focused company. The "old Ford" kind of sounds like a description of Washington, doesn't it? And who thinks that they have the cure for Chrysler and GM? What model will they use? Stay tuned folks, the road for Chrysler and GM is going to get really rocky, real soon. I fear for the many quality Chrysler and GM dealerships across America. The majority of which have been family owned for generations. In most small towns, it's the local car dealer that provides community support in so many ways. From school sponsorships to the little league ball teams, dealership owners were always there to lend a pickup truck or a convertible for the homecoming parade. The reason for their very existence is now under the microscope. If the small town dealerships go away, it will be an extreme travesty. It just makes me shake my head in disbelief. Time will tell.

Penske to Rescue Saturn?

The word is out that Roger Penske is interested in purchasing the rights to Saturn! As a former GM dealer, I'm amazed at some of the decisions that GM and/or the government is making in order to make GM viable. Can you remember when thousands of Saturn owners would go to Spring Hill Tennessee for the reunions? Saturn was a "different kind of car company" and their clients were among the most loyal of any auto maker. GM took what really wasn't a truly outstanding product and sold them through a dealer body that had to adhere to some of the highest standards in the industry. Clients could feel comfortable walking into a Saturn dealership and not be attacked by a devious sales person. The price on the window was the actual price you would pay at any other Saturn store. Saturn was the exception to the stereotypical sleazy car dealership and Americans embraced the concept in droves! What the heck happened? Believe it or not one of the primary problems was sibling rivalry. Chevy, Pontiac, Buick and Oldsmobile all got bent out of shape at the attention that Saturn was getting and that included "exclusive" product from the corporation. Somebody was always whining "why does Saturn get the hot products?" The situation reminded me of the "BRADY BUNCH" television episode that has been seen over and over: "Marsha, Marsha, Marsha!" Remember that one? The result was that in order to please all of the other divisions, Saturn went into product withdrawals as the corporation ignored the responsibility of supplying Saturn with fresh and exciting new vehicles. Saturn got stale. It started Saturn's downward trend which spiralled until the recent revamped product line which is today among the best new vehicles offered by any manufacturer! So just when the product pipeline is filled with cars and crossovers that are critically acclaimed to be among the best built today, GM decides to pull the plug! Roger Penske sees the potential of a dealer body with integrity that can compete with anyone in the USA. If he can pull it off, this just might be a text book case that will be of historic proportions. I think he can make it happen! Time will tell.