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Episode 658 – Iraq-and-Pinion Steering, Lincoln Assassination, Volvo Culture Clash

June 7th, 2011 at 12:11pm

Runtime 9:51

Chinese automakers are expanding at a rapid pace and one of them is building cars in Iraq of all places.   Geely and Volvo are clashing over the direction the safety-conscious Swedish brand should go.  GM CEO Dan Akerson adds Lincoln to the long list of brands he’s bashed.  All that and more, plus we evaluate BMW’s fast and fun X5 M.

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This is Autoline Daily for June 7, 2011. And now, the news.

IRAQ-AND-PINION STEERING
When do you know the war in Iraq is coming to an end? When a Chinese car company sets up an assembly plant there, that’s when! Chinese company Lifan just started assembling CKD units in the war-torn country. Interestingly, other top markets for exported Chinese cars include Egypt, Iran and Syria. By opening the plant in Iraq, Lifan has gone where no established automakers have dared venture.  Apparently unafraid of sectarian turmoil and political instability, Lifan’s plant in Iraq joins other similar facilities in Vietnam, Russia and Ethiopia assembling Chinese-made components into whole cars for local sale.

LINCOLN (CHARACTER) ASSASSINATION
Dan Akerson is at it again. GM’s head honcho is an outspoken leader, but just like Vice President Joe Biden he’s getting a bit of a reputation for putting his foot in his mouth. Late last year he attacked the Mercedes-Benz C-Class calling it “average,” like a c-student. More recently the “Big A” set his sights on the Prius, branding Toyota’s popular hybrid a “geekmobile.” Now the company’s cross-town luxury rival, Lincoln, is taking heat. According to The Detroit News, Akerson said, and I quote: “They are trying like hell to resurrect Lincoln. Well, I might as well tell you, you might as well sprinkle holy water. It’s over.” Ouch! Them’s fightin’ words! Look, it’s always fun hearing what executives really think, but I don’t think GM’s is doing well enough to trash talk the competition.

CULTURE CLASH
Things are off to a rocky start between Geely and Volvo, after the Chinese company acquired Volvo from Ford. According to The Wall Street Journal the head of Volvo, Stefan Jacoby, believes the company should focus on safety and fuel efficiency with small cars and stick with understated luxury. But his new boss the head of Geely, Li Shufu, thinks Volvo needs to charge upscale to compete with BMW, Mercedes and Lexus. He especially wants a large sedan to sell in China’s growing luxury market. But they are reconciling their differences with the Concept Universe that was unveiled in Shanghai. The design hints at the luxurious direction Li wants, but the car is smaller than an S-Class or 7 Series. Jacoby and Li have also compromised on how fast to grow Volvo. Li wanted to build three factories in China to grow sales but now only one will be built. But the company still has ambitious sales goals, it wants to sell 800,000 cars by 2020, more than double what it sold last year. If the two can overcome their culture clash, Volvo could become a much stronger company.

OPEN LINE: TONIGHT!
Tonight is the big relaunch of the best automotive call-in show on the web. If you’ve never tried Open Line, now’s your chance to check it out. Michelle Naranjo joins us via Skype right now.

Again, that’s 8:00 p.m.  Eastern, Time 5:00 p.m. Pacific or if you just want to learn how to make fuel out of beer, jump in at 9:00 p.m. Eastern. Watch online at AutolineDetroit.tv or listen on your phone. The call-in number is (712) 432-0900 and PIN 911633. See you there tonight for Open Line: car talk that talks back!

FREAK-O-BOOST THREE CYLINDER
Last week Ford announced it will build a three-cylinder, 1.0-liter EcoBoost engine. We pleaded, cajoled and begged Ford to give us some sort of artwork to show what this engine is about, and they finally relented. Here’s the first photo, and some of the engineering details. The exhaust manifold is integrated into the cylinder head. That eliminates enough nuts, bolts and gasket to reduce the weight of the head by two pounds. It also has an off-set crank, so that in the exhaust stroke, the connecting arm is in a directly vertical position, which reduces friction and piston side-loads. The engine first appeared in the Star concept car first shown at the Beijing auto show. We estimate that this three-cylinder engine, which does not use a balance shaft, will produce about 120 horsepower and 112 pound-feet of torque and would deliver 48 miles per gallon on the highway in a Ford Fiesta. That’s 4.9 liters per 100 km.

RACE TO REPLACE MULALLY
Speaking of Ford, the company’s chairman, Bill Ford, said that whoever is going to replace CEO Alan Mulally is going to come from within the company. So every day this week I’m presenting the candidates who I think are most likely in the running. And I’ll announce who I think is going to become the next CEO on Friday’s show. Yesterday we zeroed in on the oldest guy in the running, Lewis Booth. Today, let’s look at the youngest. Joe Hinrichs, an electrical engineer by training, actually started his career at General Motors. He spent that time in engineering and manufacturing, even becoming a plant manager. But he was certainly promising enough that General Motors sent him to Harvard to get his MBA as a GM Fellow. At Ford, Hinrichs again climbed the ranks through the manufacturing organization. But he also spent time in Logistics and later ran Ford’s Automotive Components Holdings group, its collection of supplier companies. He ultimately rose to Group VP of Manufacturing and Labor, where he proved he could work well with the UAW. To give him overseas experience Ford recently named him as president of Asia-Pacific and Africa, as well as Chairman and CEO of Ford China. Nothing helps an executive get big promotions more than delivering big growth to the company. And being in charge of markets like China and India is going to help Hinrichs do just that. But Hinrichs is only 43 years old. That means if he became CEO in another year or two he could be in that position for nearly 20 years. And I think the board of directors may decide to let Hinrichs wait for another day.

What’s it like behind the wheel of BMW’s awesome X5 M? Find out after the break.

BMW X5 M
Good things cost money. Great things cost a lot of money. BMW’s X5 M is a fast, fun-driving luxury crossover with a sticker price two bucks short of a fortune. Is it worth the nearly six-figure window sticker? Autoline Daily’s Craig Cole spent a few days driving one.

Thanks, Craig. And that’s today’s report on the top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.

Thanks to our Partners for embedding Autoline Daily on their websites: Autoblog and WardsAuto.com

64 Comments to “Episode 658 – Iraq-and-Pinion Steering, Lincoln Assassination, Volvo Culture Clash”

  1. tj Martin Says:

    Dan Akerson needs to learn the old adage of not throwing stones when you live in a Glass House .

    eg; When you’re making crap yourself , you’re not in any position to be criticizing others . Notice Mr Akerson ( in case you’re looking in ) that your SRX is not only not on my consideration list , but is in fact among my ten worst cars driven in the last 11 years . Have John give you the link to my 600 mile ten day review .

    VOLVO and their Sweden vs China woes .

    So who didn’t see this one coming from a mile away . FYI I’d side with Volvo’s thoughts on this discussion . Everyone that tries to go toe to toe with BMW & M-B gets their ( cuss ) kicked . Witness SAAB , Cadillac etc.

    You don’t COPY them ( BMW & M-B ) You offer an alternative to what they produce .

  2. HtG Says:

    Did anybody read PDL’s rant about Lt. Dan today? I was wishing I could hide.

  3. dcars Says:

    The ghost of Robert Stempl is lurking in the halls of Ford, an engineer running Ford? The money guys would never let that happen. I’m still voting for Mark Fields.

  4. ItsmeBill Says:

    I’ve know the Prius is a geekmobile since the first time I saw Weird Al’s vid “White & Nerdy”.

    “My wheels don’t spin
    To the contrary
    You’ll find that they’re
    Quite Stationary”

  5. Mark Says:

    How are those “Government Motors” IPO shares working out for you ? = lmao

  6. MJB Says:

    “…sprinkle Holy Water…” – LOL

    Too funny.

  7. dcars Says:

    Some day the Arab countries will become the next big growth market and the Chinese will be their first. In addition to building a network of cheap labor.

  8. shan Says:

    What I want to know is why they can’t build a car that will not blow a head gasket after your reach high miles. There are tons of new and old cars on Craigslist with this issue.

  9. dcars Says:

    Underestimating Ford could be a big mistake, but I will never understand the reasoning behind Ford’s rapid expansion and even quicker contraction. Billions lost for absolutely no gain.

  10. tj Martin Says:

    @ HtG

    PDL’s rant ( autoextremist ) on Lt Dan

    DAMN ! Couldn’t of said it better myself . Thought I was the crowned prince of cynicism .

    Lt. Dan and GM better watch they don’t let Dan’s foot go too far down his and GM’s throat.

    Would you like some ketchup to go with that foot Lt Dan ?

  11. pedro fernandez Says:

    Chinese-owned car factory in Iraq, manned by Iraquis, security provided by the US armed forces, please can someone stop this planet, I want to get off!! @Shan, my 98 Vibrola with 325k miles has never had a head gasket issue.

  12. Aliisdad Says:

    Two thoughts to add to today’s discussion: Akerson and his cohort are what is WRONG with the US auto industry…Remember when the head of GM said the Cadillac Cimeron was the same as a BMW 3-Series…Of course, I want the US car industry to be successful but the fact is that they produce JUNK, and they refuse to admit it!!! Yes, I do own both a 2010 American car as well as two foreign makes…US car is in shop all of the time, and the others only go in for oil changes… Second thought: I think it would be a good idea for our companies to move quickly into the Middle Eastern markets like the Chinese…Ford and GM both already build “third world” models that would be perfect (i.e. Ford models in India and small Buicks in China)…

  13. Rumblestrip Says:

    NSFW but I think Bill Jr. and Alan Mullaly have “Morning Greetings from Deadwood” for Ensign Dan
    http://www.youtube.com/watch?v=frFfQsDYeA4

  14. tj Martin Says:

    @ shan

    # 6 & 9

    Nor my wife’s old 92 Corolla , my old 88 Civic , 98 4Runner etc All having at least a decades worth of use till being sold , and still running strong to the folks we sold them to .

    Maybe CraigsList isn’t such a good resource for quality well maintained cars ?

    @ pedro

    What is the status of the boat trip my friend ???

  15. pedro fernandez Says:

    Lt Dan shouldn’t be throwing stones at anyone else’s buildings> His is not exactly shatterproof, so they’ve had a couple of hits, but the competition is very tough also. TTAC really did not like the new Civic and like most here, are of the opinion that Honda has lost whatever made them great.

  16. Kit Gerhart Says:

    I didn’t much agree with Ackerman when he bashed C-Class and Prius, but with Lincoln, he’s right on. What do they have? Uglier, and very pricey versions of a couple Ford sedans and SUV’s. The best they have is the Lincolnized version of Fusion which, in hybrid form isn’t as overpriced as the other Lincolns.

    Still, Ackerman would do well to STFU. GM has their own issues too.

  17. tj Martin Says:

    @ Rumblestrip

    Too Rude

    Too Crude

    Too Funny

    Grazzi :o I needed that !

  18. pedro fernandez Says:

    I am trying to get Castro to reactivate my Cuban citizenship, otherwise I’ll be treated like a foreigner. Oh wait, how dumb of me!! over there you’re better off being a foreigner, just gotta practice my gringo Spanish accent.

  19. Chuck Grenci Says:

    While Akerson’s statement was probably uncalled for, he basically threw out a challenge, so Lincoln has been ‘triple dog dared’ to perform; the ball is in Ford’s court. (Right now I’ve got to agree with Akerson, though not with his rhetoric; Lincoln ain’t got nothing.)

  20. HtG Says:

    is Ackerman running for something? Is he building some kind of Tough SOB Brand for himself? To selflessly serve the country later on?

  21. tj Martin Says:

    Maybe Lt Dan has been spending too much time with those Koala bears I’ve mentioned previously . All those ‘ Rainbows’ blurring his vision and all !

  22. tj Martin Says:

    the ” Koala Bears/Rainbows ” reference

    http://www.youtube.com/watch?v=P29dXIFeskm

  23. tj Martin Says:

    @ Chuck Grenci

    So what’s Cadillac gonna do if Lincoln does show up for Lt Dan’s
    ” Triple Dare ” ?

    Bleed all over Lincoln ?

  24. pedro fernandez Says:

    The Chinos got a good deal, we remove despots from all over the planet at the cost of thousands of American lives and ruin our economy, they set up their factories so they can build stuff for almost free, get richer and then we move on to the next despot and do it all over again. I think I will open that bottle of Old # 7 and mix it with some Mexican Coke that I got from my local Costco.

  25. dcars Says:

    The interesting thing about this guy is his attitude to go where no CEO will go. Talking smack to his more profitable countryman. I hope he has the company and products to back him up.

  26. tj Martin Says:

    @ pedro

    Wanna place a bet they ( Chinese ) don’t say Thank You either ?

    Well unless someone considers screwing the US into the ground a Chinese Culture form of Thank You .

    More like that morning greeting above if you ask me .

  27. SalvadorG. Says:

    IRAQ-AND-PINION STEERING
    -Well, I wonder what would the Chinese use for cheap labor and now I know.
    .

    LINCOLN (CHARACTER) ASSASSINATION
    Dan Akerson is at it again.

    - FIGHT! FIGHT! FIGHT! FIGHT! FIGHT! FIGHT!

    BMW X5 M
    Thanks for the first impressions Craig Cole.

    Also, Craig Cole can I point out that the X5 M is Limited to 155Mph not top speed of 155mph.

  28. pedro fernandez Says:

    How long before they manage to get the exclusive rights to their oil too? Double whammy for us again.

  29. HtG Says:

    Looks like the embargo has been lifted on Lutz. Here’s a link to an Atlantic piece about the new book. Don’t taze me, John!

    http://www.theatlantic.com/technology/archive/2011/06/why-gm-couldnt-be-apple-according-to-a-former-gm-exec/240006/

  30. pedro fernandez Says:

    Funny how the world turns around, in the 1800′s we used cheap Chinese labor to help build our infrastructure, like they say: payback is a bitch (even if it takes 200 yrs)

  31. pedro fernandez Says:

    In reading Lutz’s words, the same could be said for most car companies today; even Toyota and Honda, just look at the cheap-ass interiors of some of their models, I am sure the designers did not want it that way. Bean counters come in all races and colors.

  32. HtG Says:

    you also wonder about the OEMs screwing their suppliers, reducing payouts as the years go by, the suppliers screwing back, wash, rinse, repeat.

  33. Chuck Grenci Says:

    @tj
    Well, I think Cadillac has a ways to go too, but, they are on the right track (as far as I can see) and Lincoln has a lot of catching up to do. CTS in all its iterations is anyhere from pretty darn good to class leading (the “V’s”), the Escalade, while not that great, is ‘iconic’, the SRX (while not your ‘cup of tea’) has quite a few followers and admirers (I’m kind of luke warm) and with the ATS and XTS coming, we’ll just have to wait and see.

  34. HtG Says:

    @28. Sitting in both the Insight and Fit, I was put off at the hard plastics in the door panels of Insight and the dash of the Fit. It reminded me of the depressing feeling sitting in something from Chisler a few years ago.

    (today, picking up my civic from the hospital, the tech quietly told me that it would make no sense to trade into a newer model. And that a reason older models were currently in low supply on lots is that their owners didn’t have the money for a new car. There’s a lot of info in those words.)

  35. pedro fernandez Says:

    Herman, I’ve heard the same from different techs, saying the older stuff was better built than the new, despite all you hear otherwise, the fact is that I see a bunch of older Accords,Civics, Camry and Corollas in my daily travels. I’m talking 15 yrs and older.

  36. HtG Says:

    I get told by the techs that my car feels like it’s got only 15K on it. Honda made a good car, I don’t abuse it, and do regular Honda service. There just isn’t any new car that can tempt me.

  37. tj Martin Says:

    @ HtG & pedro

    I’m not sure whether the older cars were built ” better ” or not , but they sure were a heck of a lot simpler ( less to go wrong ) and a whole heck of a lot more repairable

  38. tj Martin Says:

    @ pedro

    I think the Arabs know full well ( as so should we ) that China’s current Wealth is but s temporary blip on the radar , soon to pass into oblivion .

    So while they may be sucking up a bit to grab some of that current Chinese money , they know all too well which side of their bread is buttered .

    As well as China will find out toot suite what with the Arab Spring and all , that ” Cheap Arab Labor ” ( which in reality is imported from N. Africa ) won’t be around too much longer

  39. tj Martin Says:

    FYI If you think there’s Human Rights Violations in the Chinese Labor Industry , you should have a look see at how the Arabs treat their ” Cheap ” laborers .

    The Firestorm thats arisen WorldWide about the laborers that built ( and are still building ) SheikMaranelloLand would be a prime example .

    How’d you like to be housed in an unventilated unairconditioned steel trailer in the Desert with 110 + heat , no toilet or facilities NADA . Just a steel box with a door . Which in your Arab minders eyes you should be thanking Allah for .

  40. tj Martin Says:

    @ HtG

    Whats hysterical to me about the quotes from Bob Lutz’s ” Car Guys vs Bean Counters ” ( oops did it again ) is his comparison to Apple and how the Auto Industry should be following Apples lead .

    I got into so many arguments on the CAR forum over this very topic , with even some British Auto Industry types going toe to toe with me , claiming over and over again that the Auto Industry could never be like Apple . Oh I’d beat them down , but they’d then come back with some bigger gun from the company they worked for ( verified by CAR )

    And here’s Bob saying thats exactly what they should be doing . Following Apples lead !

    Dang it if Bob aint making me look smarter by the minute .

    Thanks Bob ! Me likes you now :o

    Book release June 9th ! ( again sorry SG )

  41. HtG Says:

    tj, do you recall some of the arguments against your position.

    BTW

    Thank you for shopping with us.

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    Title: Car Guys vs. Bean Counters: The Battle for the Soul of American Business
    Format: Digital eBook
    Availability Date: 06-09-2011

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    Car Guys vs. Bean Counters: The Battle for the Soul of American Business 1 06-09-2011 $12.99
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  42. tj Martin Says:

    @ HtG

    Your question on # 41

    Why yes i do . If you’re on tomorrow morning I’ll fill you in on a few of the conflicts .

    But…… heh heh heh . I just sent a scathing email to the wingnut i know on CAR’s staff titled ” Who’s the Smart One Now ? ”

    Told him and the rest of the staff to read the book and then tell me how wrong I was . About Bernie , the auto industry etc .

    The B&N ad ! Shame on you stepping on my territory :o

    But again BOB LUTZ !

    A Big Thank You from Tj Martin

    Much Like 1776 ;

    Yanks ( Tj ) 2
    Brits ……… 0

  43. Kit Gerhart Says:

    tj, re. #40,
    By following Apple’s lead, does Lutz mean car batteries should be non-replacable, and each car brand should have it’s own proprietary connector for connecting an external audio source to the radio?

  44. tj Martin Says:

    Dealership Group warning ;

    Do not , if at all possible give your email or phone # to any member of the Hendrick Automotive Group of dealers ( Volvo and Toyota for me here )

    In spite of repeatedly telling both the salesman and the manager that I did not want any ” Follow Up ” phone calls or a plethora of useless emails ……. along with several times now hitting the ” Opt Out ” icon on their emails I am still being harassed by the dealership .

    When this happened in Spring 2010 with their KC Toyota Dealership I put it down to just being a bad apple in the basket.

    But now that the exact same thing is happening with their Volvo dealership I’ve come to the conclusion that this is the Hendrick Group M/O

    The only way I’ve found successful in getting rid of their emails and phone calls has been to SPAM their address and BLOCK their phone #

  45. HtG Says:

    tj, can I tell MajorWorld in Queens that you’re looking for a compact sedan? It’s the same deal with them. It’s like they’re family.

  46. tj Martin Says:

    F1 UPDATE !

    Wee ha !

    Now Bernie has come out firmly on the side of not having the Bahrain GP this year !

    As well as FOTA ( Formula One Teams Ass ) saying very clearly that THEY DO NOT WANT to race in Bahrain !

    I guess some 2 million fans worldwide lodging a protest with the biggest sponsor in F1 ( Red Bull ) had an effect after all

    Well if this gets settled maybe then I can enjoy the rest of the season as well as get on with buying a car . Holding back on any purchase from an F1 Sponsor since reinstating the Bahrain GP till they did the Right Thing

    Vote with your Checkbooks ! Its the ONE language understood universally !

  47. pedro fernandez Says:

    Tj have you tried Autotrader.com for you quest?

  48. tj Martin Says:

    @ HtG

    Are you sure MajorWorld isn’t part of that group ? They all go by different names depending on which part of the US you live in .

    ( Superior ( urp) in KC )

  49. tj Martin Says:

    @ pedro

    If I buy used it needs to be CPO so dealer only . New … well dealer only again .

    To be clear though it was the Volvo , not the M-B dealer thats being the pain !

    The M-B dealership has been a gem . Only calling or emailing when I’ve specifically requested them to .

  50. tj Martin Says:

    NEW New Beetle pricing

    VW just announced they’d start at …..

    $19,500

    Seeing how close that is to the MINI Cooper’s pricing , wanna place any wagers that VW just shot itself in the foot over the long term ?

  51. HtG Says:

    nah, the new Beetle is cool. Gets you in the guts. I wouldn’t underestimate the appeal. Plus when they let you walk away with one for no money down, no first month payment….

  52. Kit Gerhart Says:

    ..and you will be able to get a TDI in the new new Beetle.

  53. pedro fernandez Says:

    Tj autotrader is not just for used cars, it now has new and CPO also listed up to 500 miles away from you.

  54. HtG Says:

    he’s getting the merc, Pedro

  55. tj Martin Says:

    Hmmn .

    NEW New Beetle is cool and gets you in the gut

    Well yes it does . Urrrp ! Blaaaaat ! :(

    No Money Down . No fun once you’ve bought it . Plus VW -Audi’s world famous service and ( urrrrrrrp ) customer advocacy program . Along with their well known reliability .

    TDI . In a Fun Car ?? You’ve got to be kidding me ! Smoke Puff Wheeze Wheeze Cough Sputter !

    But if you must…. MINI is bringing over the MINI D as well . Muuuuuch better than the TDI .

  56. tj Martin Says:

    @ pedro

    Not willing to travel that far for a car . Nor do we do online purchasing .

    @ HtG

    Seriously I don’t know what we’re going to do . We’re stuck . Both of us . Maybe that 3 month rule is coming into play .

    Here’s the current thinking

    #1 Keep the MINI and rent for extended trips
    #2 Lease the new GLK , trading in the MINI
    #3 Buy a Subaru ( but I’m not liking what I’m reading ) again trading in the MINI

    But Stuck ( emotionally ) in KC we are .

  57. pedro fernandez Says:

    Keep the mini, buy gold and post-apocalyptic seeds from Glenn Beck!

  58. HtG Says:

    or, you could start doing Pilates so it’s easier to fold your bones into the Mini.
    does this look appealing?
    http://www.youtube.com/watch?v=qtk6RZZSpCQ

  59. pedro fernandez Says:

    I wonder if she also got tweets from the Weiner guy. If I need to do that to get into a Mini, perhaps a litle larger vehicle will be more appropriate.

  60. Gene Says:

    Re: Shan @ comment #8…It is my opinion that the move to ethanol is the major culprit in the head gasket problems. It doesn’t do any favors for smaal engines either…. Just my thought on the matter.

  61. Kit Gerhart Says:

    tj,
    Where did you hear that they were bringing over the Mini-D? I just read the opposite on the Autoweek site.

    Also, I get the impression you haven’t been around today’s diesels much. Even the 1.9 TDI I had didn’t smoke, and the new ones are a lot cleaner yet. The 1.9 was a low rpm engine, though, with a very low torque peak rpm, and the power peak was at about 4500 rpm. I suspect the current 2 liter TDI has similar characteristics, but 50% more power.

  62. AHamilton Says:

    Mark Fields should get the nod.

  63. C-Tech Says:

    For Shan#8, the reason why you see so many cars with head gasket problems has more to do with owners overheating the engine due to radiator, cooling fan, or water pump failures. When owners do not take care of those leaks or a bad fan, the repeatedly overheating engine ruins the head or headgasket. Always look for owners with maintenance records, the more the better.

  64. Brett Says:

    C-Tech’s right on in his reply.

    Today’s common “aluminum head on a cast steel block” engine will almost invariably warp the head or ruin the head gasket due to the considerable difference in expansion rates of the dissimilar materials.

    Actually, if you’re a good mechanic, a four cylinder with a blown head gasket can be a great deal for you as it’s not that gawd-awful a job to R&R the head, do the timing belt while your at it and have a good, reliable runner for less than $500 worth of parts and machine work. Far less than the difference between what you paid for the vehicle and what that vehicle would’ve cost you without needing the repair.