October 24th, 2008 at 12:00pm
Automakers face an “economic 9/11″ that could result in 1.4 million job losses. GM could face a management shakeup if it merges with Chrysler. Just as they arrive at dealerships, Chrysler stops production of its hybrids. All that and more, plus a preview of Mel Karmazin’s appearance on this week’s Autoline.
Transcript and Story Links after the jump . . .
Here are today’s top headlines. Automakers face an “economic 9/11.” GM could face a management shakeup. Chrysler stops production of its hybrids.
Up next, we’ll be back with the news behind the headlines.
This is Autoline Daily for Friday, October 24, 2008. And now, the news.
The chief economist at the Center for Automotive Research says the auto industry is facing an economic 9/11. Sean McAlinden says the industry hasn’t seen anything like the current business climate since 1933. The Detroit Free Press reports that GM will run out of cash in 12 months, and Ford will run out in 18 months, and says McAlinden is calling for a $15 billion cash bailout. Otherwise he says, the industry will collapse, taking out 1.4 million jobs within a year. And since this will cause suppliers to collapse, it will hurt Toyota, Honda and Nissan, as well.
The continuing saga of the possible GM-Chrysler merger . . . continues. The Wall Street Journal reports that Cerberus would want fresh management at the top of the new company. The Journal also says Fritz Henderson, GM’s Chief Operating Officer, is the deal maker in this venture. It should also be pointed out that Cerberus appointed Bob Nardelli to run Chrysler, so presumably they’d want him in the new company, too. If this report is accurate where does that leave GM’s CEO and chairman Rick Wagoner? Yeah, where does that leave him?
Speaking of Chrysler, it announced its Newark, Delaware plant will close 12 months earlier than announced. The plant manufactures the Dodge Durango and Chrysler Aspen including the hybrid versions. According to Ward’s, this means production of the hybrids will end just as they were just arriving at dealerships. It also means Chrysler won’t have another hybrid in its lineup until the 2010 Ram.
Volkswagen is not revising its outlook for 2008 despite the industry slump due to the global financial crisis. CEO Martin Winterkorn said some production cuts are being made but no drastic cuts are planned. Even though VW is on target this year, Winterkorn admits next year could be very difficult for the industry.
Ford is coming out with its version of GM’s OnStar (subscription required). It’s called 911 Assist, and Ward’s reports it will debut this year on 12 different Ford, Lincoln and Mercury vehicles. It’ll even be available as a dealer-installed software upgrade for older cars equipped with SYNC. 911 Assist is designed to contact emergency services if a car’s airbags deploy. Unlike OnStar though, 911 assist is free.
LED headlamps are probably going to become standard equipment in the next decade. Right now they’re only available on two cars, the Audi R8, and now the Cadillac Escalade Platinum. LED’s use far less power, produce brighter light and they’re designed to last the life of the vehicle. And this makes them particularly attractive for electric cars, when they come out.
Coming up next, a preview my interview with Mel Karmazin the CEO of Sirius XM Radio. We’ll be back, right after this.
Mel Karmazin used to run CBS, then he ran Viacom, and now he’s running the merged company that put XM and Sirius radio together. He’s my guest this week on Autoline Detroit, which is available right now at AutolineDetroit.tv. I asked him what becomes of satellite radio now that BMW and Chrysler are offering an internet connection in the car, which means you will soon be able to hear any radio station over the internet. Here’s what he had to say.
And that’s it for today’s top news in the global automotive industry, but don’t forget you can get podcasts, transcripts and a whole lot more on our website, AutolineDaily.TV. Thanks for watching, we’ll see you next week.