Episode 203 – The Battle for Opel, Ford & Chrysler Low on Inventory, GM’s eBay Experiment

August 10th, 2009 at 12:00pm

Runtime 6:57

Looks like the battle to get Opel is boiling down to who can get their hands on General Motors’ patents. Ford and Chrysler are running low on inventory just when they need it most. GM starts an experiment to sell cars on eBay in California. All that and more, plus a look at Dodge’s redesigned Ram pickup.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. The battle over Opel turns into a battle over GM patents. Ford and Chrysler are low on inventory just when they need it most. And GM starts an experiment to sell cars on eBay.

Up next, we’ll be back with the news behind the headlines.

This is Autoline Daily for Monday, August 10, 2009. And now, the news.

Looks like the battle to get Opel is boiling down to who can get their hands on General Motors’ patents. Reuters reports that GM claims it cannot give Magna access to its patents, or else it would violate U.S. patent laws. Magna wants to buy part of Opel and expand the brand in Russia, but it needs access to GM’s patents to be able to do that expansion. Meanwhile, RHJ, an investment firm, says it is not out of the running to get Opel.

The U.S. CARS program has been a boon for automakers and consumers, but now, surprisingly, dealers are running low on inventory. The Detroit Free Press reports that some Chrysler stores are sold out of Dodge Calibers, while there’s only a seven-day supply of Jeep Patriots! Normally a 40- to 60-day supply is ideal. Ford is running short of the Focus and Escape, both of which have been hot sellers, landing on the list of top-10 clunker replacements. With another $2 billion on the way, automakers that can’t meet demand could miss out on the sales bonanza.

Meanwhile, in Europe, the cash-for-clunkers programs, or what they call scrappage schemes, are running strong. Germany, Italy, Britain, Romania, Austria, the Netherlands, Spain and Serbia all have their own programs, but the Associated Press reports that experts worry that sales will collapse once the money runs out, and predict the business will be very tough in 2010. Automakers are pleading with their governments to phase out the cash slowly, rather than go cold turkey.

Tomorrow customers in California will be able to purchase new GM vehicles online through a partnership with eBay. According to the AP, about 225 GM dealers in California will allow consumers to haggle over the price of new cars, ask them questions and figure out financing all over the internet. Once a price is settled, cars are picked up at the dealership. It’s just a one month experiment but if it’s successful it could be adopted throughout the country.

In an effort to cut costs, China’s top-10 automakers will team up to do research and development for electric vehicle powertrains and components. According to Gasgoo.com, the project will be overseen by the China Association of Automobile Manufacturers which will help set the standards for the EVs and their parts.

Ward’s reports that Audi has canceled plans to build cars in the U.S. (subscription required), at least for now. Johan de Nysschen, the President of its American operations, said it needs to double its projected 2009 sales to justify opening a plant in the U.S. That means it needs to sell around 150,000 to 200,000 cars per year. The company announced in January that it would make a decision on building cars in America by the middle of this year.

Coming up next, a look at Dodge’s redesigned Ram pickup, we’ll be back right after this.

In 1994 Dodge turned the full-size pickup segment on its head. The boldly redesigned Ram gave buyers a truck with big-rig capability and looks.

Today, history is repeating itself. The 2009 Ram 1500 is another stylish and innovative offering from Dodge. And it’s a critical product, not just for the brand, but the whole company. The Ram is one of only a handful of Chrysler products that’s selling in any real volume. In fact, last month it accounted for nearly 20 percent of the company’s sales.

Following in the footsteps of the last two generations, designers kept the step-down front-end that the truck is known for, but they paid particular attention to aerodynamics to eek-out the best fuel economy possible. Tight body panel gaps and a spoiler integrated into the top edge or the tailgate are small tweaks that help save money at the gas pump.

The biggest news about the new Ram is probably the addition of a coil-spring rear suspension, which gives it a car-like ride and better handling. But the new smoothness comes at the expense of towing and hauling capabilities. Also, you can’t forget about RamBox, lockable and weatherproof cargo holders cleverly integrated into the bedsides.

Another revolutionary aspect of the truck is its interior. Chrysler finally got its act together and designed one with high materials quality. It’s easily one of the best the company’s ever done.

Under the hood, seven is the lucky number – point seven, that is. The base engine is a 3.7-liter V6 that’s good for 215 horsepower. A 4.7-liter, 310 horsepower V8 is optional, while a 5.7-liter HEMI with 390 horsepower is the top offering. Dodge’s engine lineup is on par with competitors like the Chevy Silverado, but it outmuscles the Ford F-150 by a wide margin. Its top engine only delivers a measly 310 horsepower.

If you need to haul heavy loads, the half-ton Ram is more than capable of meeting most people’s needs. Overall it’s a solid offering in a competitive segment. And hopefully for Chrysler its standout interior and innovative features are a bellwether of what’s to come.

And that’s it for today’s top news in the global automotive industry. But don’t forget to tune into Autoline After Hours this Thursday where we’ll be broadcasting live from the Woodward Avenue Dream Cruise, the greatest public motoring event in the world that typically attracts about 80,000 cars and 1 million spectators. We’ll be webcasting live from Auto Zone Hobbies on Woodward Avenue in Birmingham, Michigan, so stop by and say hello.

Thanks for watching, we’ll see you tomorrow.

18 Comments to “Episode 203 – The Battle for Opel, Ford & Chrysler Low on Inventory, GM’s eBay Experiment”

  1. Andy S Says:

    John, regarding your review of the Dodge Ram, the name of the game for trucks is payload and torque, more than HP. So, Autoline’s diesel junkies (Branigan, that’s you!) will want to know about a torque comparison.

  2. pedro Fernandez Says:

    John, re: the clunker story, once again these Detroit 3 bosses can’t do nothing right, they knew the clunker plan was coming and did nothing to make sure they would have enough inventory on hand, It’s true, I know a couple of people that went looking for a Caliber and they were gone except the top of the line model which they did not want. There seems to be plenty of foreign models readily available to go, however. They just keep shooting themselves in the foot.

  3. John V Says:

    Chrysler must feel left out! Autoline Daily and Autoline Detroit have already had pieces about some 2010 models. The Dodge Ram, as pointed out today (in a good presentation by Autoline), is one of Chrysler’s more important products. Unfortunately it’s a little late for the 2009 Ram which has been available for months. The 2010 Ram heavy duty trucks (2500 and 3500) should be available in just a few weeks.

  4. Art Greenberg Says:

    Pedro, Chrysler plants were completely shut down during the bankruptcy process.

    They don’t just get up in the morning and decide to increase production today. The industry just doesn’t work that way.

    I suppose you have a crystal ball and knew in advance that this program was going to result in the huge demand that it did, but others may not be so fortunate.

  5. pedro Fernandez Says:

    The point is that they weren’t ready for this just like they weren’t ready for $4 a gallon gas last year and they weren’t ready for the Arab oil embargo of the 70′s. Do you see a pattern here, Art? How about the domestics asking the Feds to delay the clunker program until they could get their plants going again, after all the idea was to help the American auto industry AND to replace gas guzzlers with higher mileage vehicles, that’s part of the reason so many buyers turned to import brands

  6. G.A.branigan Says:

    @Andy S.:Yup,I am definately hooked on small clean diesels.The torque comparisons between gas V-8′s really doesn’t mean much to me.My last diesel was a 4 cyl 2.8L crd.300 ft.lbs. of torque and 28+mpg combined average.That was for a 4X4 at that.I hated the rest of the vehicle due to poor quality and the total lack of off road capability without going into lifts etc.There just isn’t a good reason to buy into the high tech gassers anymore,at least for me.Sooner or later our once big 3 will finally start having diesel options,and I’ll be waiting for it.I have given the upcoming mahindra some serious thought,but in the end,I still want a diesel JK.So I wait…..and wait…..and wait.

  7. pedro Fernandez Says:

    Why on earth the Feds won’t let small diesel engines be sold here is beyond me. Besides the reliability and durability of these engines, they end up costing less to run. Yet you see big trucks and rigs spewing diesel fumes like there’s no tomorrow, but cars have to have super expensive and complicated exhaust equipment. It’s not fair.

  8. dcars Says:

    GM and Chrysler were not ready for the cars program, they had other things on their mind. The ford guys were ready, when I stopped at a ford dealer a week a before it began, they had salesman lined up waiting and they knew all about the program! If GM lets go of their patents they’ll give up their soul, better to close down Opel and stay with Chevy in Europe.

  9. pedro Fernandez Says:

    Perhaps these companies thought that if they ran out of smaller vehicles, customers would go for their larger offerings without thinking of the foreign brand dealers across town who were only too happy to take advantage of the CARS program

  10. dcars Says:

    The Toyota boys were clueless too! The Nissan dealership was ready and making deals. Ford seams is ready to take charge if they can get people to believe in them again. After traveling in Europe I can’t say I’m not sold on diesels. I live in Buffalo, NY and the Canadians will drive their diesels across the boarder and they seam to spew a lot of black smoke, but I’m open to anything.

  11. G.A.Branigan Says:

    @dcars:if you see a diesel puffing out black smoke,that is unburned fuel and not good.It could be that the vehicles were older and did not have the electronic computer controlled injector pump that all the clean diesels have.On the older mechanical pump diesels,an easy way to get more power out of them was to decrease the amout of return fuel,thus upping the rail pressure and increasing the amount of unburned fuel.BTW,that practice has been illegal here in the states for decades.

  12. pedro Fernandez Says:

    dcars: Toyota had 3 models in the top 10 list of sales during the clunkers sales blitz, so I don’t understand why you say the dealers were clueless. I saw many tv spots locally telling people to go to a local Toyotaa dealer and get $4500 for your old car

  13. dcars Says:

    G.A.Branigan: thats pretty interesting! In Europe the cars had a bad smell.

    Pedro: The Toyota guys, as did all the dealers did learn very quickly, but before it started, it just seamed like some of the dealers weren’t prepared. My statements came from my local experiences, it could be that other places were better prepared.

  14. G.A.Branigan Says:

    @dcars:Hmmm,I don’t know why they would have a bad smell to them.I do know that when we made the switch to low sulpher diesel fuel it didn’t smell at all.I never got a whiff of diesel either burned or unburned in the 2 years we had the Libby crd.What type of diesel do they run in europe?

  15. C-Tech Says:

    Hello everyone. Working at a family-owned dealership (7 stores, 10 franchises) they were not prepared for the CARS program and are still struggling with it. It is not the government’s fault but the way management (family and friends) tried to interpret and use the program sadly. It has still been successful, and the Chrysler and Mazda stores are running out of inventory. We (Chrysler) have less than 100 vehicles, about 40 of them trucks. Normal inventory is about 300. We will be a used car dealer by september! Given the lack of competition in the small diesel engine market, there may be an opportunity with a small diesel truck. Given the Dakota platform, Chrysler should consider offering a small Diesel in it.

  16. G.A.Branigan Says:

    @ C-tech:The big three had plans for the clean diesels,then got cold feet and pulled them.Not to worry though,Mahindra’s will be hitting the american market near the end of the 4th quarter this year.When they sell out,maybe then the big 3 will open their eyes.

    It is kinda funny though,Jeep offered the crd in the liberty’s for 05 and 06.Jeep figured they would sell maybe 18k units for the both years.They had that all wrong.They sold everyone they were able to produce for both years.It is said the big 3 won’t bring in small diesels until there is a demand….how can their be a demand for a product that in this country,doen’t exsist?Catch 22 automotive style.

  17. G.A.Branigan Says:

    There is something I want to add:Several weeks ago I wrote to Global,the outfit that is bringing in the Mahindra small diesel pickups.I was given the pleasure of an answer the following day,which is essentially the info in my post above.

    Twice now I have written to Fiat,and have recieved NO REPLY.Again,one company see’s clearly a niche to be filled,and other companies won’t address the wants of customers therefore negating the “when there is a demand” line.It is not hard to see why the american manufacturers are so hard pressed.They don’t listen and “just don’t get it”.If that ain’t sad,I don’t know what is bros.

  18. pappie1 Says:

    what about some talk on 2010 ford taurus limited awd compare to 2008 model . would like to compare both cars