Episode 972 – CAW Targets Ford, Treasury Won’t Sell GM Stake, BMW Shows Off Paris Reveals

September 17th, 2012 at 11:45am

Runtime: 8:36

The Canadian Auto Workers chose Ford as its strike target as it tries to negotiate a new contract before it expires tonight. General Motors is pushing the U.S. Treasury Department to sell its stake in the company but it won’t because GM’s stock price isn’t high enough. BMW is showing off more of the vehicles it will reveal at the Paris Motor Show. All that and more, plus a look at the all-new 2013 Mercedes-Benz GL.

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Thanks for joining us today as we start a whole new week of watching what’s going on in the world of cars. It’s September 17, I’m John McElroy and here’s the news.

Well you know we’re in the middle of a re-election campaign when the President goes to the swing state of Ohio to bash the Chinese. Bloomberg reports the president will announce a trade complaint against the Chinese for $1 billion in illegal subsidies of auto parts that were exported to the U.S. If it goes through, look for the Chinese to retaliate with trade sanctions of their own. Two months ago the Administration filed a complaint with the World Trade Organization because of import duties slapped on American-made cars that were sold in China. China imposed those tariffs in retaliation against U.S. tariffs on Chinese-made tires.

Speaking of China, the protests against Japanese-made cars is really starting to turn serious. Many Japanese dealerships in China are closed today after some of them were attacked over the weekend, with cars being turned over and the windows broken. Sales of Japanese cars are slowing there because Chinese consumers are worried about those cars being vandalized.

The Canadian Auto Workers chose Ford as its strike target. The contract runs out tonight. The Detroit automakers want the CAW to accept similar concessions that UAW members agreed to last year and have said Canadian labor costs are among the highest in the world. Honda and Toyota, which have plants in Canada, are not organized by the CAW.

GM would love to shed its “Government Motors” image but the U.S. Treasury Department isn’t helping. The Wall Street Journal reports GM is pushing the Treasury to sell its stake in the company but the U.S. would lose about $15 billion if that happened now. GM’s stock would need to reach $53 a share for the U.S. to break even, currently it’s about $24 a share.

The Paris Motor Show opens its doors next week and we’ll be there showing some of it to you LIVE, but until then here are few more announcements. We already showed you BMW’s Concept Active Tourer. It will also show the compact 1 Series that gets all-wheel-drive for the first time. Of course Bay-Emm-Vay is known for motorcycles as much as it is cars. The company will debut a battery-powered scooter in Paris. The C evolution prototype features a liquid-cooled electric motor and a range exceeding 100 kilometers. The ever-popular 3 Series is getting a new engine, a 1.6-liter version of the brand’s 2.0-liter TwinPower turbo four-cylinder. Output is 136 brake horsepower. A six-speed manual or an eight-speed automatic are the transmission choices offered. Stay tuned to Autoline Daily for more updates on the Paris Motor Show.

In related news BMW may be in talks to buy De Tomaso. The specialty automaker filed for bankruptcy earlier this year. Over the years De Tomaso built cars for a number of other automakers including the Chrysler TC and Ford Pantera.

How tough is your truck? Toyota is out to prove the muscle of its Tundra. On October 13 one of these full-size pickups will tow the Space Shuttle Endeavour to the California Science Center. This 300,000 pound vehicle will be hitched to a factory-stock Tundra, which will drag it the last quarter mile to its final resting place. How do you move such a monumental piece of equipment with a light-duty truck? A special rig, that’s how. Lots of ballast probably helps, too.

(The Mercedes-Benz GL review is only available in the video version of today’s show.)

And that wraps up today’s report. Thanks for watching, we’ll see you tomorrow.

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26 Comments to “Episode 972 – CAW Targets Ford, Treasury Won’t Sell GM Stake, BMW Shows Off Paris Reveals”

  1. pedro fernandez Says:

    Is there a connection between NASA investigating the Toyota sticky pedal issue and this? Conspiracy I tell you, all a conspiracy!

  2. pedro fernandez Says:

    Commies don’t change their ways, do they? no matter how they try to appear to be open minded and open market, their old ways creep in again and again.

  3. Jon M Says:

    Toyota is taking some risks with its endeavor (pun intended) to usher the Space Shuttle to its final home out of the skies. I’m not sure how much credibility it will gain from a successful tow job, but boy what an embarrassment if anything goes wrong.

    The story broke about a week ago and is getting a lot of hate from the comments I’ve seen. The pickup truck segment is loyalty-driven, so I imagine there would be bashing no matter the truck brand to which the Endeavor was hitched. But surely a Japanese brand truck will fume the masses the most. So much the better for Toyota if all goes well.

  4. Kit Gerhart Says:

    I’m curious about how Toyota worked out that deal.

    As long as the tires on the shuttle are pumped up good, and as long as the trip is not uphill, I’d think it should be not big deal for a 4WD pickup in low range, with an automatic transmission. It just won’t accelerate very fast.

  5. MJB Says:

    That GL550 is a very nicely refined auto. The wife and I test drove one against a Range Rover HSE Sport just this past weekend. Albeit, the one we tested was a 2012 model, it was still top notch.

    The one thing the GL lacked that the HSE Sport had was a touch-activated/sensitive multi-media/nav screen. The screens were about the same size, but only the Rover’s was touch controlled.

  6. G.A.Branigan Says:

    Good thing toyota is using a new tundra to do this.The old ones have frames prone to rust failure,lol.

  7. Jon M Says:

    Politics is as much about strategy as any chess or football game is. As such, the Treasury Department’s decision to hold fast to its ownership stake in GM is as much a strategic decision as it is a business decision. Sure GM wants to ditch the Government Motors moniker, but the Treasury Dept. is at least wise enough to know that unloading their stake in the company at $15 billion loss would not sit well with the hapless constituents who unwillingly funded the bailout with their taxed paychecks. Now consider that the nation is on the cusp of a major election and you have to ask: What was GM thinking?

  8. C-Tech Says:

    Now what are economists saying about the benefits of free trade with China?

    The CAW may win this battle, but in the long run they may lose the jobs.

    GM is hoping to buy (or at least get into friendly hands) the Taypayer shares on the cheap. I am glad the administration is holding out for a better deal.

    When I call my friends to help me move I get no answer! Next time, I’m calling Toyota North America!

  9. pedro fernandez Says:

    Wow! Mexico is looking muy bonito for these automakers still battling unions despite the fact that they’re still not out of the woods from their near collapse of 3 yrs ago.

  10. Chuck Grenci Says:

    Agreeing with the above; any of the brands of trucks would be able to ‘do the pull’ (it’s not like they are going up a ramp engulfed with fire a nd pulling a trailer, or anything) –tongue fully in cheek :)

  11. dcars Says:

    Our government is taking part in a publicity stunt by a foreign manufacturer? Not a good thing to do.

  12. G.A.Branigan Says:

    Even though the tundra ‘only’ has to pull that 1320 ft.I can’t help but think of the trans oil temps going through the roof….especially on a ‘supposedly’ stock truck.I have only seen a handful of the tundras around here over the years.Lots of the tacomas,but very few of the full size.I will watch this pull and enjoy it.I am however surprised that the big 3 didn’t vie for this given the horsepower wars they were doing only a short time ago,especially ford with their ecoboost v6.

  13. Brett Says:

    Take up the Toyota stunt with the Los Angeles Science Museum. I doubt seriously if the shuttle remains NASA’s property after it comes off the 747. I would imagine that Toyota made a much appreciated financial gift to the museum’s trust fund to do that stunt.

  14. pedro fernandez Says:

    Lucas oil and transmission additives to be used, I’m sure!

  15. NannieState Says:

    The US Government is starting a trade-war at the same time China is flexing their political identity muscle over the South China Sea Islands. The Chinese LIKE imports and they’re willing to PAY the premium price. The Chinese think that their local car brands are NOT GOOD. All that this trade complaint will do is a) buy political points in the US, b) have the Chinese impose tariffs on US goods and c) REDUCE the sales of US cars into China. Thanks Mr. President.

  16. C-Tech Says:

    @ #15
    So when would it be convenient for you to file this trade complaint? Perhaps the U.S. (as in “US”) should simply bend over and grab both cheeks for the communists?

  17. Kit Gerhart Says:

    If they were going to have a “stunt” involving a pickup towing the shuttle, Toyota was the obvious choice. GM was out, and to a lesser extent, Dodge, due to the “government motors” factor. They couldn’t use Ford, because they are the archrival of Chevy. That leaves Toyota, which is as “American” as the others, but without some of the baggage.

  18. Tony Gray Says:

    Only 136 horsepower out of that 1.6l BMW motor? Wow, I hope that is a typo…or BMW is seriously under rating that output.

  19. Kit Gerhart Says:

    The 136 hp is correct. According to one web site I found, there is even a 100 hp 1.6 liter turbo in the 114i.

  20. pedro fernandez Says:

    136 hp is perfectly adequate for the congested, stop and go traffic most of us face every single day, never mind all those ads showing wide open, windy roads that are shown to help sell cars, no one will be buying if they used the reality of our daily schlep.

  21. HtG Says:

    You’re starting to sound like me, Pedro. Did I tell the story about following a shiny Porsche RSR 4.0 through country roads in CT as it stayed behind an old SUV? For 10 miles? Until the longest passing straight opened up? THEN it passed the POSUV. Then I did it too, with my measly 100hp, and you should have seen the frizz haired gal in the POSUV start freaking and gesticulating and mouthing some drivel at me. Good times.

  22. pedro fernandez Says:

    I had a similar experience last weekend, I took the FR-S on an early Sunday drive to a horse farm about 35 miles from here, two lane secondary road, not much traffic, but dangerous to pass, I had 4, yes FOUR slow moving vehicles including someone towing a freaking boat ahead of me doing exactly 5-10 miles under the limit, never got the chance to pass, I got so dejected I just joined the conga line.

  23. HtG Says:

    So hard to have any driving pleasure. The marketing is like porn to keep buyers dreaming. All it takes is one slow poke to ruin everyone’s ride. On the other hand, did I tell you how a Cobra, a Ferrari, and little me all passed a horse carrier, in formation? This was en route to Lime Rock, which explains the fast cars.

  24. Chuck Grenci Says:

    I don’t want to put any words in Tony’s mouth (post #18) but I’m thinking maybe he was referring to output/liter; some of the newer stuff is putting out 130hp/liter (this one being 136hp with a 1.6); just saying, don’t know.

  25. Kit Gerhart Says:

    136 hp for a 1.6 turbo is kind of low, but it must be tuned for low rpm and high fuel efficiency. I probably have about the extreme of low specific power for a turbo gas engine in my ’89 minivan, 150 hp from a 2.5 liter.

  26. Kit Gerhart Says:

    I looked up data on the 136 hp 116i engine, and as I expected, the power peak is at a very low 4350 rpm, and the peak torque is at 1350 rpm.