Rumor - GM to put Chevy Volt program on hold / CUt staff today

You must have missed the part where Corker was told Cerebus is a hedge fund company that has no cash for Chrysler right now. He didn't shut down the Chrysler CEO at all.

 

an article...

Detroit Rarely Misses a Chance to Miss a Chance | Autopia from Wired.com

i question the validity of the statement

To their credit, the Big Three are building smaller, more fuel-efficient cars. General Motors has more models that exceed 30 mpg than any other automaker, and it offers more hybrids than Toyota.

but the rest of the article is reasonable

 

Wait ... I thought you were a FAN of auto bailouts. What, only GM?Cerebus also owns a huge piece of GMAC. But it is highly unlikely that they are flushed with cash. Most of their holdings are in the toilet. The bailout has more stinky layers than Drug dealing - O.J. - the Simpsons' and the Goldman family . . . more layers than will ever hit the news.

Why the GM - Cerberus - Chrysler Bailout is Bad for Taxpayers : Information Clearing House - ICH

Bottom line, when most all our governmental leaders are inextricably linked to the very businesses they watch over / protect us from, then it can't be good.

 

If I'm an employee or stockholder in the company I want profits. The Prius is a nice car and gets good mileage. That doesn't mean that it makes money for the company. Why do you think Toyota has been concentrating on SUV and truck sales for the last 5 years?

 

Different people have different needs. The Prius is perfect for my road trips. In town, my Zap Xebra is better for me, and better yet would be a freeway-capable EV with a 100-mile range. I talked to a guy yesterday who races. He needs a vehicle capable of pulling a trailer with his race car. Someone who lives on a bad country road may need a 4WD.

 

I am a fan of the US government loaning money to the automakers with oversight as done with Chrysler 30 years ago.

However, Chrysler is a lost cause as a stand-alone company. They have some good products; Dodge Ram, Dodge Caravan, Viper, and Jeep Wrangler. The rest is not competitive in today's market. Cerberus bought Chrysler for the financial business and as been very openly trying to sell the manufacturing side every since. Nissan / Renault is interested in Jeep and the Ram. Nissan already has a contract for Dodge to supply all of their trucks starting in 2011. Renault sold Chrysler the Jeep brand back in the 80's and wants it back at a bargain rate. GM wants the minivan. They don't have a minivan and Chrysler's minivan is brand new, highly reviewed, and is the best selling minivan in the US. Chrysler is also contracted to supply VW with minivans for the North American market. The Viper is almost a stand-alone company. It is a limited volume product that is hand-assembled in its' own facility. As such it could easily find a buyer that wanted a turn-key sports car business with a very loyal following.

It would make the most sense for GM to absorb Chrysler, sell Viper, keep the minivan and contract with VW, sell Jeep to Renault, and provide Nissan with rebadged GM trucks instead of rebadged Dodge trucks.

Cerberus has $24 Billion in assets. If they don't have the cash on hand to keep Chrysler running they could easily use their assets to back loans to Chrysler. The won't because they have no interest in the business and don't see a return on that additional investment. However, if Congress is willing to hand over the funds, all the better. That will give them time to break up the company and sell it at a better price than what they would get under a chapter 7 bankruptcy.

I don't see why the US government should give Chrysler $7 billion to keep Chrysler running for another year. Cerberus only paid $7 Billion for Chrysler to begin with. If the government was to invest that amount of money they should just buy out Cerberus and break up Chrysler on their own or merge it with GM

 

Technically, Chapter 7 is liquidation. Chapter 11 is bankruptcy protection

 

Cerberus did not even pay $7 billion. They paid Daimler $7 billion on the condition that Daimler would invest another $7 billion in Chrysler, or something along those lines. All Cerberus did was take all of the obligations (health, pension, debt) off of the books of Daimler.

All of the cash that Cerberus paid Daimler was simply a transfer to replentish the bank accounts at Chrysler with $7 billion. Daimler didn't make any cash on the deal.

 

I'm aware of the difference but I don't see Chapter 11 as an option for Chrysler. Chrysler doesn't have the range of vehicles to be a viable company.

 

Chrysler's first bail out certainly didn't solve their problems. If anything, the Federal government should just take control of the auto industry like they do for every failed bank. All 3 will get tons of money thrown at them because Congress excels at two things: Wasting money, and spending like drunken sailors. (I apologize to every drunken sailor for comparing them to Senators & Congressmen.)

I wouldn't count on GM's warranty. Dealers didn't want to honor it back in 2000-2003 and Mr. Goodwrench still can't fix anything in one trip.

 

Apparently, just like our current "controlled depression", GM has put the assembly plant on "skids" that makes the 1.4L engine specifically used in the Chevy Volt. They still say that they are still going to "roll out" the Volt by 2010 though. :der:

I suppose you can still buy an engine for a Hummer...

GM delays Volt engine factory - Autos- msnbc.com

 

The Volt will use a form of the 1.4L engine used in the Chevy Cruze. The Cruze is a world car and is currently on sale in Asia. It will go on sale in Europe during the second quarter of 2009. They have lots of options to get the limited number of engines required for the Volt.

 

GM will have no trouble at all getting enough engines for all the Volts they actually plan on building. That's because it does not require an engine plant at all to manufacture zero engines. I could manufacture zero engines in my garage if I wanted to. Zero is, in this respect and others, a very interesting and useful number.

Not only could I build zero engines in my garage, with no engineering experience at all, I could even make zero engines with 500 horsepower and 500 mpg when mounted in the same number of Ford Mustangs.

 

Am I the first one to notice that Lutz has announced he'll retire at the end of this year - a year before the Volt is to be brought to market? That can't bode well when your biggest champion decides to punch his ticket before the ride begins.

Automotive News Email Blast -- Registrants=

 

I'm guessing that the bloggers are going to go nuts shortly. Stand by for that!

 

I'm not all that surprised. A couple months ago around the time of the congressional hearings Lutz said that if Congress needed a sacrificial lamb he was the one. Iacocca, Lutz speak out on possible Wagoner ousting - MotorAuthority - Car news, reviews, spy shots

The timing of this isn't by coincidence, GM has to submit their viability plan to the "Car Czar" next week.

 

wow lutz retiring?? hmm, that pretty much means that the Volt has encountered other issues.... oh well.