Episode 159 – Chrysler Deal Hits Snag, Bailouts Could Hurt Ford, Qatar Invests In Porsche

June 8th, 2009 at 12:00pm

Runtime 6:31

The state of Indiana’s pension funds asked the U.S. Supreme Court to block the Fiat-Chrysler deal. The government bailouts of General Motors and Chrysler could hurt Ford. The emir of Qatar promised Porsche to take a stake in the company. All that and more, plus a look at the redesigned Buick LaCrosse.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. The Fiat-Chrysler deal faces a potential delay. The government bailouts of GM and Chrysler could hurt Ford. And Porsche finds a Sugar Daddy, a “Zuckervater.”

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

This is Autoline Daily for Monday, June 8, 2009. And now, the news.

Just when it looked like the Fiat-Chrysler deal was done, it hit another delay. The state of Indiana’s pension funds asked the U.S. Supreme Court to block the deal. They say Chrysler’s unsecured debtors-meaning the UAW-were paid before the secured debtors were, meaning them. The Indiana pension funds are arguing that the Obama Administration can’t do this, that it’s illegal, and they’re practically goading the Supreme Court to take the case, saying it can’t let the Executive Branch assume this kind of power. Reuters reports the Court will decide today if it is going to take the case.

And the Wall Street Journal warns that Ford is going to emerge in an uncompetitive position against GM and Chrysler (subscription required). It points out Ford lost over $30 billion since 2006, still has $33 billion in debt, isn’t getting government support for its finance arm, and is not able to axe thousands of dealers. Even so, I’m sure GM and Chrysler would love to swap positions with Ford, and the company just announced it wants to reopen its contract with the Canadian auto workers union.

The country of Qatar will invest in Porsche. The AFP says the emir of Qatar promised Porsche to take a stake in the company. This will help Porsche in its bid to take full control of Volkswagen. The amount of the investment was not reported.

General Motors will not import subcompacts to the U.S. from China as part of its deal with the UAW. According to the Detroit Free Press, three U.S. plants are in the running to build the small vehicles. GM’s Sprig Hill, Tennessee factory is the front runner but plants in Lake Orion, Michigan and Janesville, Wisconsin are in the running.

Ward’s reports that GM put a hold on dealer orders for Chevrolet Malibu and Saturn Aura Hybrids (subscription required). Dealerships have a large number of unsold 2009s. In addition to GM’s problems, blame it on relatively low gas prices and the fact that the hybrid versions of these cars are not that much more efficient than the four-cylinder models.

In the coming weeks, electric carmaker Tesla will open seven new sales and service centers around the world. Right now it only has two stores – both of them in California. If you live in Chicago, London, Miami, Monaco, Munich, New York or Seattle, look for a Tesla store to open near you. The company is also scouting locations in Washington D.C. and Toronto.

Last week we reported that Roger Penske was expected to become the new owner of Saturn. On Saturday GM released a statement confirming details about the proposed transaction that would save 350 dealerships and 13,000 jobs.

Coming up next, a look at the redesigned Buick LaCrosse, we’ll be back right after this.

General Motors unveiled the all-new, redesigned Buick LaCrosse at this year’s North American International Auto Show in Detroit.

It was the first GM vehicle to be created on three different continents. The design was done in the United States and China and the body and chassis were done in Europe.

It was inspired by the Buick Invicta concept shown at the 2008 Beijing Auto Show. It features a historically Buick sweep spear character line on the side of the body, portholes on the hood and the classic waterfall grille.

Inside is what one would expect from a Buick. The interior is highlighted with chrome accents, wood trim, leather seating, and ambient cool blue lighting on the center console, instrument and door panels. Thread and stitching on the instrument panel also enhances the look.

Under the hood the LaCrosse offers two V6 engines, a new 3.0-liter and a 3.6-liter, both with direct injection. And both are mated to a six-speed automatic transmission. Fuel economy for the 3.0-liter is 18 MPG, or 13.1 l/100km, in the city and 27, or 8.7 l/100km, on the highway. The 3.6L gets one MPG less in each category.

Amenities that are available in the LaCrosse include a navigation system with rearview backup, Bluetooth connectivity, USB port, a rear power window sunshade and rear DVD entertainment with screens integrated into the back seats.

Available safety features include adaptive front headlights, blind spot warning, Stabilitrak, traction control and front, side and head curtain airbags.

Pricing for the LaCrosse starts just under $28,000 and runs hits nearly $40,000 fully loaded. Production of the LaCrosse begins this summer at GM’s Kansas City plant.

I want to take a moment here to proudly announce that Autoline Detroit, our half-hour discussion program that you can find on our website, just won an Emmy Award. That’s the highest praise you can get in the television business. I want to specifically recognize my producer Chip Drake and my creative guy Ben Sanders who were the real recipients of these Emmys. And I want to thank Detroit Public Television for broadcasting the show.

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.com. Thanks for watching, we’ll see you tomorrow.

28 Comments to “Episode 159 – Chrysler Deal Hits Snag, Bailouts Could Hurt Ford, Qatar Invests In Porsche”

  1. Jim Bianchi Says:

    Congrats on the Emmy, John & team!

  2. jeff mohr Says:

    Staight talk with honesty,substance and depth should win an award, just wish the rest of the media were half as good as this one

  3. Gerald Thompson Says:

    Great job on the Emmy John! You and your team deserve this honor.

  4. paul stewart Says:

    Way to go John & the team too.Great info and perspectives . Your voice carries well too over the airwaves !!!

  5. Jeff Taylor Says:

    Congrats on the Emmy! Well deserved.

  6. mike weber Says:

    To hear knowledgeable and influential people having in depth, respectful conversation about the fundamentals of the business, your show has been the place to go for years. Your presence on the net extends your reach globally. Thanks for helping me tell left from right, forward from backward.

  7. G.A.Branigan Says:

    The deal with chrysler/fiat should be blocked and the supreme court should look into this.The boy king needs to be shown his limits in regards to ANY american business.

    Congrats John! An Emmy is a HUGE DEAL,especially for an automotive news program.You and your crew have done extremly well.

  8. Dan Clemons Says:

    I am so happy to see John and his staff win this Emmy award. Yours is one of the best shows on TV! What I appreciate most is John’s love of cars.

  9. Alex Kovnat Says:

    Congratulations John on winning the Emmy award!

  10. Nichole Reesman Says:

    Congrats on winning the Emmy. It is well deserved.

  11. Laura Oliveto Says:

    Awesome, gang. A huge testimonial to excellence.

  12. Episode 159 - Chrysler Deal Hits Snag, Bailouts Could Hurt Ford, Qatar Invests In Porsche Says:

    [...] Original post by John’s Journal [...]

  13. mike weber Says:

    nice, real nice

  14. Kit Gerhart Says:

    The treasurer of the state of Indiana wants to kill Chrysler to make some sort of statement, even though it would cost thousands of jobs in his own state. Those pension funds made bad investments, and as happens when you hold bonds in a bankrupt company, you can lose money. While it might not work long-term, the deal with Fiat is Chrysler’s only chance of survival, and it needs to procede.

  15. pedro Fernandez Says:

    John: congrats to you and and your staff on a well deserved award. You provide fair, balanced coverage and ask the hard questions others don’t. I was wondering if the Feds, who now are part owners of GM, will ever buy any Ford products to resupply their fleets when it becomes necessary? Even when it comes to replacing local and state vehicles, the feds will tell local and state govts. to buy GM vehicles if they get any fed dollars?. ps. I am renting a Cobalt while my Corolla gets an new motor, Very impressed with the car. Leaps and bounds better than the last Cavalier I rented a few years back. Would actually consider buying one.

  16. Hermann the German Says:

    Totally Super shows John, all three.

  17. Salvador G. Says:

    Congratulations on the Emmy Autoline Detroit, you guys deserve it. I’m just glad John McElroy love for the little Puma didn’t drag you guys down, keep up the good work.

  18. Dan Keefe Says:

    I used to watch your show on Speed, but I rarely watch it now from the web, as I don’t get Detroit Public Television where I live. You should inquire with TiVo about getting your shows hosted on their DVR’s via TiVoCast. I contacted Blue Sky Productions about this, but never heard anything. TiVo will air your show, by free subscription, to any TiVo owner. Your show downloads from the Internet to the DVR and is held as a recorded episode just like an over-the-air show.

    Companies like CNET, New York Times, and others use this service, and there are other car shows available, so it would be a good audience for you. TiVo has well over 1M subscribers.


  19. Alex Kajdi Says:

    John McElroy, Chip Drake and Ben Sanders:

    You guys and your staff should be very proud of receiving this Emmy, Congratulations!

    I am very encouraged to hear that Roger Penske Auto Group will be taking over the Saturn Brand and saving all those jobs at the Saturn Dealerships. My local Saturn Dealership, Saturn of White Plains, NY has always been very good to me. The News Release from GM states that Saturn Dealers will receive Aura’s, Vue’s and Outlooks on a conract basis. Will the Penske Group be able to order Electric Vehicles from GM once the Chevy Volt is available to the general Public? If so, Penske should contract with GM to get their own Electric “Voltec” Vehicle styled between the Chevy Volt and The Opel Ampera. I would like to suggest that Mr. Penske name this addition to his dealers lineup as the “Saturn Ion”. The “Ion” name is already known as a Saturn model, and is a perfect fit for an Electric Vehicle under the Saturn Brand.

    John, Chip and Ben keep up the great work and you will be holding another Emmy next year.

    Best Wishes.

  20. Edward Walsh Says:

    Congratulations on the Award for your show and its take on the Automotive Industry!

    One thing I would like to see is for all shows on your website be available for viewing in full screen. Someday soon………..???

    Again, all the best!!

  21. Kit Gerhart Says:

    Penske should import some diesel Peugeots to sell as Saturns. I rented one last summer, and it was a nice driving car that got great fuel economy.

  22. Reno Diggs Says:

    What is it, twelve years now? Autoline is my longest watched show. Congrats, does an Emmy feel like ‘Car of the Year’ award? Thanks for an entertaining forum for my auto industry education.

  23. don norris Says:

    ask you a question and took your advice on “if you were to buy one of the big 3….who would you lean toward…..” you said ford looked stonger than the other 2 based on many issues……so i got a ford(sport track ) and you know, it is functional and good quailty..thanks for your input…..don

  24. pedro Fernandez Says:

    I think Penske has an opportunity to carefully seek out what’s out there and import them and make a substantial dent in the automotive marketplace, but he needs to be careful with the diesels due to the fluctuating price of the fuel.

  25. G.A.Branigan Says:

    Regular gas here is at $2.69.9.Diesel is 35 cents cheaper.

  26. pedro Fernandez Says:

    G.A. remember at the height of the gas prices, diesel was more expensive than premium, so there’s no way to tell, and if demand goes up for diesel, you can bet your house that the price will shoot up again.

  27. Richard Tait Says:

    Congratulations John, Chip, Ben, and the rest of the team on the Emmy! I bet that crap tv station Speedchannel is really sorry now. Morons. I always knew you would end up better off without them. Keep up the great work!

  28. Kate McLeod Says:

    Bravo Emmy winner. Excellence recognized.