Episode 214 – GM Board Snubs Its CEO, Recyclers Want GM in Mercury Program, Samoa Switches Sides
August 25th, 2009 at 12:00pm
Runtime 6:46
General Motors’ board shoots down management’s recommendation on Opel. Recyclers don’t want GM withdrawing from a program to recycle switches with mercury in them. Samoa is going to switch the side of the road it drives on. All that and more, plus we try to settle last week’s trivia question for once and for all. Which nameplate is older, the Corvette or Suburban?
Transcript and Story Links after the jump . . .
Here are today’s top headlines. GM’s board shoots down management’s recommendation on Opel. Recyclers don’t want GM dropping out of a program to recycle mercury switches. And Samoa debates which side of the road to drive on.
Up next, we’ll be back with the news behind the headlines.
This is Autoline Daily for Tuesday, August 25, 2009. And now, the latest in the auto industry.
This soap opera over what’s going on at Opel keeps getting more and more interesting. Now, General Motors says it may not sell Opel, and will try to raise $4 billion on its own to keep it (subscription required), by mortgaging its assets in China. This, of course, is going to further anger the German government and labor leaders, who, as we reported yesterday, are already angry over the delay. Even more interesting, the Wall Street Journal reports that GM’s CEO Fritz Henderson had recommended to the board that it take Magna’s offer to buy part of Opel, but the board, led by Texan Ed Whitacre, rejected its own CEO’s recommendation. To me, that, more than anything else, shows how much GM is changing. It’s been a long time since we’ve seen the GM board reject a recommendation from management. And it sends a signal that this board is going to be far more active than past ones.
And speaking of GM, The Institute of Scrap Recycling Industries sent a letter to President Obama asking him to stop GM from withdrawing from the program to recycle switches with mercury in them. Recyclers are paid $4 a switch to remove it from a car to have it properly processed. Automakers kick into a fund to pay that money. GM spends about $1 million a year on the program, but believes cars in junk yards are a problem for the old GM, what is now called Motors Liquidation.
Earlier this summer, Toyota announced it will not host next year’s Formula 1 Japanese Grand Prix at its Fuji Speedway track. But now, according to Autoblog, Honda will host the race for the next three years at its Suzuka course. The ironic thing is, even though Honda will host the race, they pulled out of F1 earlier in the year.
Samoa, a small island in the Pacific Ocean, is going to switch to driving on the left side of the road. According to the Wall Street Journal, beginning in September, drivers in the country will be forced to switch from driving on the right side of the road to the left. Samoa’s Prime Minister argues that Samoans will have access to cheaper used cars from its neighbors in Australia and New Zealand who drive on the left side. There is opposition to the change from a newly created group called People Against Switching Sides, or PASS, which argues that it will just cause confusion and make driving more dangerous. The last time I remember a country switching was Sweden, which changed from driving on the left, to driving on the right, in 1967.
GM and Chrysler car dealers who lost their franchise have been jumping into the used-car market. But Autoblog reports that one store near St. Louis is trying something really different. Lynch Hummer of Chesterfield, Missouri, is “diversifying” its business by selling guns and ammunition! The owner says it’s a natural fit since the typical Hummer driver enjoys outdoor sports. Only in America could you buy an H3 and a Glock in the same store.
According to the website WorldCarFans.com, Audi is set to reveal a performance version of the A3 at next month’s Frankfurt Motor Show. Nothing is official yet, but rumors of an RS3 have been swirling. It seems likely that the high-power hatchback would use the same turbocharged inline-five as the TT RS. The 2.5-liter engine should produce around 340 horsepower, but 400 ponies certainly aren’t out of the question. You know, small cars are only going to get more popular, especially in the U.S., as gas prices start climbing. And high-performance pocket-rockets offer a ton of driving fun without sucking you dry at the gas pump.
Coming up next, we try to settle last week’s trivia question for once and for all. Which nameplate is older, the Corvette or Suburban? We’ll be back right after this.
Last week’s trivia quiz has generated a bit of controversy in our comment section. We asked Jim Hall from 2953 Analytics to come up with a good trivia question, and boy did he ever. His question is, “What is the longest running nameplate in the American auto industry?” And the answer is, the Chevrolet Corvette. But a number of viewers protested, saying the Chevrolet Suburban has been around a lot longer. It started in 1936 and has been in continuous production since then, making it 17 years older than the Corvette. So I called Jim Hall and asked for a clarification. His response: back in 1936 GM offered a body style on a truck that was called the Carryall Suburban. But it was a body style, not a nameplate. In fact, it was not until 1967 model year that the Suburban had a badge on it that said Suburban. So, the longest-running nameplate is the Corvette, and that’s the story we’re telling, until somebody can prove us wrong.
Across town and around the world, that’ll do it for today’s top auto news. As always, thanks for watching, we’ll see you tomorrow.
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Comments (37)
August 25th, 2009 at 12:17 pm
The latest in the auto industry. Two days in a row. John used to say now, the News.
See, we DO pay attention.
August 25th, 2009 at 12:20 pm
John,
I will say this again, since you repeated your prediction about ‘small cars’ becoming popular in the US again, because gas prices are expected to rise.
I don’t disagree that gas will not be dirt cheap as it used to be. Not because we are running out of oil, as some unscientific fools and darlings of the “gloom and doom’ media claimed and failed in every one of their “peak oil” predictions so far,
But because China and India’s demand will grow faster than the slow moving oil producers will invest in developing additional capacity.
HAving said that, a small car and a fuel efficient car (which is what people will need if gas goes up) are NOT THE SAME THING!
Please check the facts and understand that the tiniest of cars sold in the US, the “SMART” (or, as I call it, the “DUMB”), gets lousy MPG for its size, while the Prius easily gets 10-20 MPG ABOVE what the much smaller, lighter SMART gets.
In the 50s-60s and again in the 80s, there werr eplenty of cars with plenty of room but with good MPG, because they had much smaller engines and HP.
DOes a family car need the average 200 HP today? NOT AT ALL! It can easily go by with 100 HP. Even with 100 HP it will probably still be able to reach 3 digit speeds, which are illegal in all 50 states now!
August 25th, 2009 at 12:30 pm
I was surprised John left out, in this very slow news day, a major piece of news about GM: It has decided to remove the “GM” logo from all its vehicles! Talk about retreat… and surrender… a real disgrace. I bet a beancounter will pop up to note that this measure will save GM $0.49 per vehicle..LOL.
August 25th, 2009 at 1:04 pm
QJim S:He covered that news several weeks ago.
August 25th, 2009 at 1:08 pm
Here’s a link to some pics of 1953 Ford F-250 and F-350′s that seem to show they were badged as F250/F350.
http://auto.howstuffworks.com/1950-1959-ford-trucks4.htm
1953 was the year Ford switched numbering systems from F1 to F8 to the three digit system we have today.
http://www.ford.com/about-ford/heritage/vehicles/fseries/669-f-series
I assume they would do a rolling name change at the start of the year rather than mid-year, but I’m not sure… can someone confirm?
The first Corvette rolled off the production line in June of 1953.
August 25th, 2009 at 1:08 pm
G.A.B. How is this possible? The news only appeared today in “Automotive News”. You probably are thinking of something else?
August 25th, 2009 at 1:13 pm
“Tony Gray Says:
August 25th, 2009 at 12:17 pm
The latest in the auto industry. Two days in a row. John used to say now, the News.”
Or, more accurately, “yesterday’s news”. After reading Jim’s post, I expect John to mention the elimination of the GM logo from its vehicles in tomorrow’s broadcast.
August 25th, 2009 at 1:14 pm
In fact,it was discussed at length on AAH’s several shows ago.
August 25th, 2009 at 1:21 pm
For a country to switch from rt side to left side driving is very dangerous, I remember going to the Bahamas and thinking: what if some distracted half-drunk tourist forgets for a minute where they are, and go on the wrong side of the road? Adios, muchachos, see you on the other side. by the way John has been saying that GM will get rid of the logo for quite a while now! Like if that’s gonna help.
August 25th, 2009 at 1:37 pm
John,
Maybe Australia and New Zealand should think about switching from driving on the “Left” side to the “Right” side. This would give Australia and New Zealand access to the American Used Car Market. This could potentially increase US exports of used cars. I think that the Samoans would have loved to receive our Clunkers. This would have been more agreeable to me instead of that ridiculous “Cash for Clunkers” program which destroyed hundreds of thousands of good used vehicles. The “Cash for Clunkers” program is going to hurt those American would usually obtain their vehicles from the used car market due to economic reasons. The “Cash for Clunkers” Program shortened the useful lives of may good pre-owned vehicles and sends them to oblivion. I believe this will drive up the value/cost of existing vehicles in the used car market. This Program will now make it harder for some American to obtain first-time and/or replacement vehicles which were able to be purchased previously at more affordable prices.
August 25th, 2009 at 1:37 pm
Maybe John was SPECULATING that GM would drop the logo, but the decision was taken only today.
August 25th, 2009 at 1:39 pm
>And high-performance pocket-rockets
>offer a ton of driving fun without
>sucking you dry at the gas pump.
If you want high fuel economy and high performance, and don’t mind an increased risk of being killed or horribly injured, try motorcycles.
August 25th, 2009 at 1:39 pm
“This would have been more agreeable to me instead of that ridiculous “Cash for Clunkers” program which destroyed hundreds of thousands of good used vehicles. The “Cash for Clunkers” program is going to hurt those American would usually obtain their vehicles from the used car market due to economic reasons.”
Absolutely agree, this idiotic program was the worst of any cash for clunkers program world-wide. But good luck convincing John and the happy dealers…who got the taxyayer’s hard-earned cash for 4,500 rebates they give out ANYWAY at the end of each model year..
August 25th, 2009 at 1:41 pm
“# Alex Kovnat Says:
August 25th, 2009 at 1:39 pm
>And high-performance pocket-rockets
>offer a ton of driving fun without
>sucking you dry at the gas pump.
If you want high fuel economy and high performance, and don’t mind an increased risk of being killed or horribly injured, try motorcycles.”
If driven hard, these POS do NOT have even decent MPG, let alone “high”. Just look at “Car and Driver” tests and how dismally low MPG they manage to get from every itty-bitty POS “hot hatch”.
August 25th, 2009 at 1:42 pm
I think GM wanted to keep Opel the whole time; and I even think it’s a good idea to do such. Between Detroit, Opel and Holden, GM has put together some real fine world class vehicles. Now, from what I understand, if they can get some of their primo Chinese Buicks stateside, they would even be that much better.
Thanks John for clearing up the trivia challenge question.
And for Samoa, I’m going with; it’s probably pretty lame to switch sides for just the used car market reason.
August 25th, 2009 at 1:46 pm
@ Thor
I finally found something I can agree with you on ……….. the Smart Car, really isn’t smart at all!
August 25th, 2009 at 1:50 pm
As for the price of used cars going up – I don’t see that happening. Drive through any town, of nearly any size, throughout the United States, and you will find a used car lot. I recently drove through a town of 250 residents, and there was a used car lot with 4 cars on it. Go to a metro setting, and you’ll find hundreds of used car lots with hundreds of cars, plus all the new car dealers.
My dad used to say “There are so damn many new and used cars sitting around, they could quit building cars for 5 years, and nobody would even notice.” The more I see, the more I believe that he was about on target.
August 25th, 2009 at 1:54 pm
Especially the versions sold here in the US.
In Europe they have the 70 MPG or so Diesel, that IS fuel efficient, and even their gas version is equipped with the stop-go system that allows them to get good MPG. A friend of mine who leaves overseas in a big city just bought one of these, a demo with very low miles, for about 9k Euros ($13k), and saves about $100 a week in gas (he drives a lot) vs if he used one of his two BMWSs (an X3 2.0 and a 530). he likes its ease of parking anywhere, and but he has low expectations, he views it as a scooter more than a real car. In the summer, he disables the stop-go because it affects the A/C, and his MPG drops.
But besides the MPG, the SMART is very poorly made, with a lousy transmission etc, as reviews in US car mags pointed out.
August 25th, 2009 at 1:55 pm
Simple Supply and Demand: If you remove about half a million clunkers (used cars that fetch around $4,500 each), that segment of the used car market will eventually face a huge shortage, and prices will only go higher.
August 25th, 2009 at 2:32 pm
The cash for clunkers program was just that , a CLUNKER because it will decrease the amount of good used cars for the people that cannot afford a new car and it has about .05 percent effect on the fuel consumption in this country! Plus all the people that now got the new cars , how many will not be able to make the payments on the new car and the car will be repossessed ?
Pontiac should be kept in the US auto market.
Look what Holden is going to do , sell G8′s under the Holden brand as higher end cars to use up the parts. The Holden Commodore / Pontiac G8 is a wonderful car that is built better than some of the cars built here and best of all it has Rear Wheel Drive and can be had with a 6 speed manual trans , and at a competitive price.
BRING PONTIAC BACK
BRING BACK THE IMPALA SS IN RWD
HAVE TRUCKS SOLD BY CHEVROLET OR GMC NOT BOTH
Edward Lipman
August 25th, 2009 at 2:40 pm
When you add up the lower new car sales, people keeping their cars longer, and this automotive mass destruction which just occurred, there will be spot shortages of used cars, specially lower priced “transportation” vehicles. There will always be late-models available but for the small independent dealer it’s getting rough. Plus a lot of used vehicles are being exported to third world countries, adding to the shortage.
August 25th, 2009 at 2:59 pm
Thor
I guess I will have to be the bad guy.
- This is not the “Thor Show”!
- Your continuous ranting is really starting to bother a lot of people (myself included) that read and contribute to this exchange of ideas and views.
- You have been asked by several others to tone it down a bit but you have failed to take the hint.
- On your way out don’t let the door hit you in the a$$, just lock the door behind you and don’t come back.
- No disrespect intended, but……
Dwight Barnes.
August 25th, 2009 at 3:02 pm
I met this “Stupid” car owner the other day and asked him WHY? He went on to say it was “economical” and “cool-looking”. I couldn’t say anything back to him, being he was a client, but holy crap, what a lame excuse to buy that car. I’d take any other subcompact available today for less money , same or better mileage and a hell of a lot safer.
August 25th, 2009 at 3:18 pm
YOu are wasting your breath, whoever the hell you are, “Dwight”. I do not remember criticizing YOU, and I am not going to waste my time with your whining and bitching.
I will consider complaints only from the OWNER of this site, JOHN MCELROY. It is HIS Show, not yours.
Now get lost, retard.
August 25th, 2009 at 3:25 pm
Thor, what part of my post did you not understand ? This will be my last comment on this.
Have a nice day.
Dwight.
August 25th, 2009 at 3:28 pm
For Samoa, it probably makes a lot of sense to switch to driving on the left. For the same reason, it would make sense for St. Thomas, St. John, Barbados, Jamaica, and a number of other Caribbean islands to start driving on the right. Currently, left-hand-drive used cars from the U.S., Mexico, and other and places are as common as the right-hand-drive cars that are “proper” for these islands. The only right-hand-drive cars available are either new, or come from at least as far away as Britain, making them much more expensive than used LHD cars.
August 25th, 2009 at 4:03 pm
This Jim Hall sounds like he knows just about everything. But if he really wants to impress, he will explain what the significance of the number 2953 is. OK big boy, take your best shot!
August 25th, 2009 at 4:11 pm
I owned a 3/4 ton 20 series 1972 CARRYALL.There was NO such mentioning of SUBURBAN on/in it or the papers from GM or the dealer.The unit was listed as a mini bus /3 doors for curb access.I purchased it for School car pooling and RVing.The first I know of the SUBURBAN as a name plate was on the completely redesigned 1973 with 4 doors and no rain rails on the roof.From 1934 until 1972 the units were called CARRYALLS.That 67 with a CARRYALL emblem looks fabricated.
August 25th, 2009 at 4:26 pm
John McElroy,
Re:
“but the board, led by Texan Ed Whitacre, rejected its own CEO’s recommendation. ”
Do you think the concept of GM competing against GM/Opel’s own technology and patents sold in the market from a cut throat manufacturer has finally sunk in ?
August 25th, 2009 at 4:30 pm
My uncle had a ’51 Plymouth Suburban. It was a two door car-based station wagon, and was a “base” model with heater and oil filter being options.
August 25th, 2009 at 4:33 pm
If GM doesn’t sell Opel, can they continue to supply cars to Roger Penske(Saturn)?
August 25th, 2009 at 8:18 pm
Thank you Dwight B
I just skip over his rants now – as I suspect most of us do.
For the rest, thank you for your comments
I wonder if GM will run foul of the Washington bunch if they try to keep Opel. Would they (Washington) try to get their money back?
Same thing if they tried to reverse their decision on Pontiac???
August 25th, 2009 at 9:18 pm
Do you think Thor is actually….the Stig?
August 25th, 2009 at 9:42 pm
As a part owner of GM, I hope GM somehow hangs on to Opel. They will really need Opel as a source of future designs for when America’s vehicle looks more like that of Europe. No one knows when that time will come, but it WILL come.
August 26th, 2009 at 9:39 am
John,
this quote from Autoblog illustrates my point about NOT needing SMALL cars to be fuel efficient, to the Nth Degree:
All, read carefully:
“…Reports are now popping up suggesting that Mercedes will soon up the frugal luxury stakes with a new S 250 CDI BlueEfficiency – the first S-Class with a four-cylinder engine.
According to the rumors, it will use the 2.2-liter, twin-turbocharged diesel four-pot fitted to the E- and C-Class, putting out 224 horsepower and 368 lb-ft of torque. ..and mileage, which is predicted to be 35 mpg.
To keep the four- and six-cylinder engines from being too close to one another, the six is said to grow in output to 285 hp and 516 lb-ft, and that should spell the end of the eight-cylinder S 450 CDI engine.”
Note this is NOT any itty-bitty Merc, it is the S-class, the top of the line big, heavy car, and BMW’s 7 Series competitor.
August 26th, 2009 at 11:31 am
“# Tony Gray Says:
August 25th, 2009 at 9:18 pm
Do you think Thor is actually….the Stig?”
Very flattering, perhaps the nicest thing anybody here said about me today, thanks, but no, I am not remotely like the Stig. I don’t even own a helmet. My style is not track laps but 940+ mile a day cross country rides when I can (and get fully reimbursed for). last time I did this was in 2003, was able to go from DC to Seattle in 3 days ,Seattle to Long beach CA from 3 PM on a Fri to 8 PM next day (including a 2-hr stop in Sacramento to visit a young woman I knew). And from LA to DC in 4 days on the way back.
August 27th, 2009 at 12:24 am
[...] 26, 2009 Powered by Max Banner Ads Episode 214 – GM Board Snubs Its CEO, Recyclers Want GM in Mercury Program, Samoa Switches Sides Runtime 6:46 General Motors’ board shoots down management’s recommendation on Opel. [...]