tag:blogger.com,1999:blog-5107919020158007482024-02-20T14:29:26.557-05:00Wall Street - AutomotivePast, Present & Futures - Opinions and Observations - By Robb LoForeseUnknownnoreply@blogger.comBlogger27125tag:blogger.com,1999:blog-510791902015800748.post-52970561691625089012018-12-10T09:48:00.000-05:002018-12-10T09:48:03.795-05:00I'm back <div>
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Testing </div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-31914643508802698902011-10-18T07:58:00.003-04:002011-10-18T08:05:53.859-04:00Yuan's trip to Sweden<p class="MsoNormal"><span class="Apple-style-span"><span style="background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; "></span></span></p><span><span>(originally aired September 22)</span></span><div><span><span><br /></span></span></div><div><span><span>Any Saab North American turnaround would involve new leadership and new thinking. </span></span></div><div><span><span><br /></span></span></div><div><span><span>First in a series of 4 articles covering Saab's; Products, Market Share, Revenue and Cost Structure.</span></span></div><div><span><span><br /></span></span></div><div><span><span>1. Products:</span></span></div><div><span><span><br /></span></span></div><div><span><span>9-5 (D.O.A.) Cancel the new 9-5 carline (including the estate/wagon) – consolidated gross profits on this carline is likely not sufficient to sustain $12,000 PNVR market support (exception to limited Russia and China sales). This car is a failed execution for the brand, has very limited appeal to current/former Saab owners and is way over-priced for a Buick LaCrosse. This action would demonstrate a serious commitment towards a new business approach (its ok to admit to mistakes and save money too).</span></span></div><div><span><span><br /></span></span></div><div><span><span>9-4X (reposition – keep it simple – conquest Japanese - seek volumes – do it quickly) Re-position the new 9-4X – offer one variant for US sales: </span></span></div><div><br /></div><div>* 3.0 Liter AWD (kill the 2.8 Liter Turbo)</div><div><span><span>* Aero Badge (with all Aero trim - exception to seating surfaces)</span></span></div><div><span><span>* Standard equip.: sunroof, Aero styled front end (w/fog lamps), 19" alloys and Bose system.</span></span></div><div><span><span>* Only option is NAV. </span></span></div><div><span><span>* Priced at $39,995</span></span></div><div><span><span>* Plan 1,200 units per month. If the price point of $39,995 can’t be achieved then abandon the 9-4X carline as well.</span></span></div><div><span><span><br /></span></span></div><div><span><span>9-3 Sedan (depreciated cash cow – conquest Japanese – seek volumes - do it quickly) Continue through MY2013 – conquest and bridge carline - offer one variant for US sales: </span></span></div><div><span><span><br /></span></span></div><div><span><span>* 2.0 Liter (auto or manual) </span></span></div><div><span><span>* Aero Badge (with all Aero trim - exception to seating surfaces)</span></span></div><div><span><span>* Standard equip.: sunroof, pwr seats, 17" alloys, rear spoiler, Aero trim, and fog lamps.</span></span></div><div><span><span>* Only option is NAV. </span></span></div><div><span><span>* AWD platform abandoned. </span></span></div><div><span><span>* Priced at $24,995</span></span></div><div><span><span>* Plan 2,000 per month. </span></span></div><div><span><span><br /></span></span></div><div><span><span>Aggressively target owners of Honda Accord, Toyota Camry, and Nissan Altima with trade incentives. At the same time increase the warranty coverage to 6 years / 100,000 miles (similar to the older CPO warranty once offered – bumper to bumper). </span></span></div><div><span><span><br /></span></span></div><div><span><span>Factory note: Forget silly 30 day money back guarantees - these are negative selling propositions (sales people spend more time promoting what happens if you don’t like the car.. rather than selling the product). </span></span></div><div><span><span><br /></span></span></div><div><span><span>Current 9-3 Combi (discontinue) Feel good carline (with no following) needs to go. </span></span></div><div><span><span><br /></span></span></div><div><span><span>Current 9-3 Convertible (discontinue) Historic transaction price (after market support) is $29,995 – rather than build a car you lose money on .. end it and place all engineering and design efforts on the new 3 Convertible - very quickly.</span></span></div><div><span><span><br /></span></span></div><div><span><span>-------------------- </span></span></div><div><span><span><br /></span></span></div><div><span><span>New 3 Convertible (launch spring 2013) First launch as image car and prelude to the new 3 Sedan. Similar to what Saab did for MY2003 only the convertible is launched first. MSRP should not exceed $10,000 from the highest priced sedan (sub assembly type production volumes – 800 per month to start).</span></span></div><div><span><span><br /></span></span></div><div><span><span>New 3 Sedan (launch January 2014 as MY2015) (Think retro 1985 Saab 99) This car must be a functional hatch back design - priced at $29,995 – with MPG of 35 – 40 MPG. Forget the Phoenix, forget attacking BMW or Audi. Moving people upscale from Honda, Nissan, Toyota, and domestic brands should be the goal. Small chips into their volumes and Saab can easily sell 50,000 units. The new 3 needs to be affordable, function, and durable - European price leader. AWD should not be in the program. Hybrid should be considered. Advanced technologies (features) should be abandoned. Quality fit, finish, and use of high touch, high quality feel is most important. Warranty period 6 years / 100,000 miles. The new 3 should be assembled in China, production savings would allow higher quality / efficient drive line components. After 6 months launch New 3 VIGGEN as a zero to 60 offer in time for spring orders. </span></span></div><div><span><span><br /></span></span></div><div><span><span>New 1 Coupe (retro Saab 96) – I’ll leave this up to the profitable new organization (suicide doors are a must however). So is a diesel engine with 50+ MPG. </span></span></div><div><span><span><br /></span></span></div><div><span><span>------------------ </span></span></div><div><span><span><br /></span></span></div><div><span><span>So there you have it. Push volumes for price leading models for 2 years. Trim overall offerings, make it simple to communicate. Go after large volumes of customers and make Saab exciting and affordable till new models arrive. Position new products as price leading European offer - assembled in China.</span></span></div><div><span><span><br /></span></span></div><div><span><span>Of course the above is created without consolidated financial statements, however I believe most (if not all) recommendations can be implemented. Likely typical in most major markets - exception toRussia and China where almost anything goes with volumes less than 1000 units per year.</span></span><p class="MsoNormal"><span class="Apple-style-span"><span style="background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; "></span></span><span style="font-size:7.0pt; font-family:Arial;color:#222222;background:white"><o:p></o:p></span></p></div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-61523827794846519072011-10-18T07:49:00.004-04:002011-10-18T08:06:20.250-04:00Saab - Managing the Ridiculous<span class="Apple-style-span"></span><span><span><span class="Apple-style-span">(Originally aired Sept 1, 2011)</span></span></span><div><span><span><span class="Apple-style-span"><br />From Saab’s web site today … quoted “Swade”... </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span"> “Saab’s problem right now comes down to one thing and one thing only – a cash shortage. We didn’t have enough cash to meet obligations at one stage earlier this year and key suppliers made a decision that it was too big a risk for them to allow us to trade our way out of that situation. To win them back, we need to find the cash. Our fault. Our task to fix. We are working on it flat-out.” </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">It’s unbelievable, the propaganda Saab expenses on what is truly nothing but their own fault. </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">“Saab’s problem right now comes down to one thing and one thing only – a cash shortage."</span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">Let’s explore Swade's comment. In the US, I estimate Saab has been burning around $35 Million per month since February 2010. In it's arrogance Muller’s team took the position “if we build - they will come.” </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">From a base line 250 sales per month, Saab began pushing unrealistic sales objectives to its dealers at the “burning gas” pace of 1500 per month. Targets not achieved, Saab's leadership team encouraged dealers report “service loaner” sales each quarter end.<br /><br /></span></span></span></div><div><span><span><span class="Apple-style-span">Note: Service loaners are nothing but phony sales to the manufacturer (and press). Dealer takes a car in stock, reports the car to the factory as a service loaner sale, then parks the car in his back lot. Because the car was reported to the factory as a delivery the car's warranty begins. Its estimated that in CY2010 Saab reported more than 40% service loaner sales and the press reported these sales as +++% over last year. </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">What makes these actions so ridiculous is that factory executives forget about these phony sales and start telling dealers “we are gaining sales momentum over last year.” </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">Even more ridiculous ...Sweden doesn’t have a clue…they believe “wow US sales are kicking ass so lets build and ship more cars” when in fact dealers are parking the cars in back lots unsold. </span></span></span></div><div><br /></div><div>The public, and most of the press, have no clue how sales are manipulated. </div><div><br /></div><div>In any regard, Saab was reporting sales but NOT finding end users to drive them. This nonsense goes on most of CY2010. Inventories build at dealers and ports (bi-products sit unsold to this day).</div><div><br /></div><div>Some other significant achievements during CY2010 and early 2011 … </div><div><br /></div><div>The 2010 9-3 Convertibles built in CY2009 (missing trim items) are delivered to dealers in March 2010 (without proper marketing support most sit unsold for almost a year). </div><div><br /></div><div>The 9-3 XWD Combi (wagon) is launched unsold with no ad support or promotions. </div><div><br /></div><div>The first 2010 9-5 Aeros are delivered to dealers with no sunroof and are basically "tryout" models without proper finishing and options (missing remote start, plastic trim has no grain, priced over $53,000). You can find these service loaner cars on Ebay tonight for $39,000 - unsold. </div><div><br /></div><div>The first 2011 9-5 2.0 Liter FWD cars land, $10,000 higher than the car it replaced. And as of today is a complete failure.</div><div><br /></div><div>And this nonsense is just related to car sales. </div><div><br /></div><div>Let’s not discuss:</div><div><br /></div><div>Lack of brand awareness </div><div>Lack of brand positioning </div><div>Lack of any logic in product offers</div><div>Lack of any showroom dynamics </div><div>Lack of Tier 1, 2 and 3 advertising </div><div>Lack of anyone knowing what “bi fuel” stands for </div><div>Lack of promotions and competitive position</div><div>Lack of corporate communications to owners</div><div>Lack of profitable dealers </div><div><br /></div><div>But according to Swade ….Saab’s “only” problem is a lack of cash. In the early months Saab indeed had tons of CASH.</div><div><span><span><span class="Apple-style-span"><br />Saab executives failed to ask the most significant question..<br /><br /><span class="Apple-tab-span" style="white-space:pre"> </span>What is it we are doing and why?<br /><br />Saab never had an honest business plan, and no one had the ambition to tell Victor Muller.. “the plan you have.. well sir it’s not a very good one and here is why.”</span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">Note: There was one very bright exception.. however he only lasted a few months and moved on to a German brand. </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">More CASH Swade? How ridiculous.</span></span></span><div><p class="MsoNormal"><span style="color: rgb(34, 34, 34); background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span class="Apple-style-span"></span><span class="Apple-style-span" style="font-family: Arial; font-size: 7pt; "><o:p></o:p></span></span></p></div></div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-60111163025018475102011-10-18T07:44:00.006-04:002011-10-18T08:07:06.479-04:00McDonalds<h3 style="margin-top:9.0pt;margin-right:0in;margin-bottom:0in;margin-left: 0in;margin-bottom:.0001pt"></h3><span><span><span class="Apple-style-span">(originally aired August 18, 2011) </span></span></span><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">From a Saab Dealership point of view...<br /><br />If McDonald's corporate stopped making burgers but kept invoicing (charging) independent McDonald's franchisee's for cardboard burger boxes, paper cups, napkins, advertising fees, and facility upgrades, I suspect McDonald franchisees would rally together, hire an attorney and sue the parent company for breach of their franchise agreement.<br /><br />If the CEO of McDonald's stated McDonald's indeed had a fully funded business plan (three times) when in fact they didn't, I suspect McDonald franchisees would rally together, hire an attorney and sue the parent company for breach of fiduciary responsibility and reliance.<br /><br />In essence that's life of a Saab dealer today, however in this story Saab dealers do nothing.<br /><br /></span></span></span></div><div><span><span><span class="Apple-style-span">-------<br /><br /></span></span></span></div><div><span><span><span class="Apple-style-span">A major problem with Muller's Saab is the organization itself. Muller's "leadership team" followed bad habits learned from larger car companies. Mile high dealer objectives, monthly dealer invoicing, poor communications and departmental walls reflect the culture / habits of GM, designed with a focus of selling millions of cars.. not 3,000 Saabs. Examples:<br /><br />GM styled product offerings - Lets look at Saab's new product offerings. The new 9-5 and 9-4X, designed by former GM employees, reflects a mindset of carlines selling in the the tens of thousands - rather than one hundred. Both the new 9-5 and 9-4 offer a ridiculous high matrix of trim and option packages typically found in Chevy and Buick showrooms.<br /><br />GM type push for special tools and launch parts - Once again following the mind set of GM, the new Saab organization delivered to its sleepy dealers tens of thousands of dollars in 9-5 and 9-4X spare parts and special tools (how about a $12,000 engine support stand for the 9-5!).<br /><br />GM Type facility standards - Following GM's "you should be thankful your still a dealer feeling," Saab requested its dealers volunteer thousands of dollars in facility updates ("ice block" building designs) at the same time Saab is not producing cars?<br /><br />This nonsense doesn't happen by accident, it happens because no one asked the hard question:<br /><br />What are we doing? and Why? </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">At minimum, Saab Corporate should have treated their dealers at a graduate level - reducing the financial burdens of keeping Saab dealerships open during these turbulent times. Deferring or suspending all dealer invoicing for items as i.e., Saab cups, plates and paper napkins would have been a great start. </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">Franchise Agreements and state laws are in force to protect dealership rights. Now facing closure, Saab dealers are left holding large inventories of new cars, parts and special tools. </span></span></span></div><div><span><span><span class="Apple-style-span"><br /></span></span></span></div><div><span><span><span class="Apple-style-span">But no one speaks.<br /><br /></span></span></span></div><div><span><span><span class="Apple-style-span">Not Saab's dealer council. Not NADA. Not AIADA. Saab dealers are united... their passiveness during difficult times was truly amazing.</span></span></span><p class="MsoNormal"><span style="background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "> </span><span style="font-size:7.0pt; font-family:Arial;color:#222222;background:white"><o:p></o:p></span></p></div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-72273628391385608462011-10-18T07:34:00.010-04:002011-10-20T07:51:08.676-04:00Muller's Wind Tunnel<p class="MsoNormal"><span class="Apple-style-span"><span class="apple-style-span"><span style="background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; "></span></span></span></p><span><span>(originally aired August 1, 2011)</span></span><div><span><span><br /></span></span></div><div><span><span>Saab Vs. A Wind Tunnel</span></span></div><div><span><span><br /></span></span></div><div><span><span>Back in January 2010 - Victor Muller stated he purchased Saab for the price of a wind tunnel. Once the purchase of Saab was completed, Muller proudly stated "Saab didn't need one new customer," meaning, if former Saab owners purchased new Saab's, the new organization could easily sell over 100,000 units. </span></span></div><div><span><span><br /></span></span></div><div><span><span>The first time I heard these comments I was really taken back. Was this Muller's 15 minutes of fame speech? or ... was he indeed serious?</span></span></div><div><span><span><br /></span></span></div><div><span><span>Prior to Saab's death in December 2009, Muller was impressed by the thousands of Saab owners gathering in support of saving Saab. 18 months later Saab owners have made it very clear.. they are not impressed. </span></span></div><div><span><span><br /></span></span></div><div><span><span>-------- </span></span></div><div><span><span><br /></span></span></div><div><span><span>Assembly plants idle since April, Muller’s Saab is rushing to fill 11,000 orders.</span></span></div><div><span><span><br /></span></span></div><div><span><span>Why?</span></span></div><div><span><span><br /></span></span></div><div><span><span>Exception to the already funded China orders... why the rush to build cars people are not buying? It's estimated the US has an 11 month supply of unsold (new) 9-5 Sedans with MSRP's ranging from low $40's to upper $55's. There are thousands of 9-5 brake rotors collecting rust at US ports as well. </span></span></div><div><span><span><br /></span></span></div><div><span><span>The all new 9-5 may have looked great on consolidated balance sheets (at inflated MSRP’s) but the true cost of sale per unit is likely close to $15,000 per copy (and this doesn’t include the cost of advertising per car sold). The consumer (and current Saab owners) have spoken, they don't want a GM based 9-5 sedan.</span></span></div><div><span><span><br /></span></span></div><div><span><span>The same is unfolding with the all new 9-4X, without launch support to attract "conquest buyers" the carline is failing.</span></span></div><div><span><span><br /></span></span></div><div><span><span>Its fair to say Muller worked very hard, doing wrong things, very well. </span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to place GM employees in key executive roles during critical start up periods.</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to embrace Koenigsegg's business plan without proper due diligence.<br /><br /></span></span></div><div><span><span>* Rush to the media without a convincing plan for the brand - to the press and general public.</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to jettison Born from Jets (top 6th recalled automotive slogan) and launch a internally defended global marketing campaign "move your mind."</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to pretend to be an environmentally focused brand without products to back it up.</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to build GM based 9-5’s without defining its need and audience. </span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to build the multi million dollar Phoenix project (abandoning the award winning Aero X).</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to build GM based 9-4X without defining its real need and audience. </span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to build GM based 9-5 Wagon (segment so thin.. US sales are likely less than 50/month).</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to burn cash without managing the rear view mirror (wholesale and revenue plans).</span></span></div><div><span><span><br /></span></span></div><div><span><span>* Rush to build 11,000 cars with no market demand or retail support.<br /><br />Unfortunately Muller's Saab is just about finished. There is no saving Saab this time around, and I'm not sure if there is anything left of the brand to save any longer.<br /><br />Hopefully when its all said and done, and the factory is turned into a freight train assembly plant, someone will purchase the Saab logo and start something up again just for fun.<br /><br />Pity dealers who have inventory, loyal employees, customers needing warranty repairs and Swedish Govt & EIB who were taken by Muller's salesmanship.<br /><br />Creditably shattered but not defeated, Muller now eyes the wind tunnel.</span></span><p class="MsoNormal"><span style="background-image: initial; background-attachment: initial; background-origin: initial; background-clip: initial; background-color: white; background-position: initial initial; background-repeat: initial initial; "><span class="Apple-style-span"> </span><span class="Apple-style-span" style="font-family: Arial; font-size: 7pt; "><o:p></o:p></span></span></p></div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-65508491099211564242011-08-29T16:38:00.005-04:002011-08-29T16:42:02.722-04:00Blog ContinuesWhile on air last week a caller asked why I haven't kept up on my blog? So that being said.. I'm back, I will try and update weekly radio show topics and thank you dear caller for the reminder. <div>
<br /></div><div>Robb</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-42537099612977167942009-10-13T12:58:00.003-04:002009-10-13T13:03:49.170-04:00UBER richAnd now the Wall Street automotive report, sponsored by Country Saab.<br /><br />Al Gore started it, Bush approved it and Obama signed it.<br /><br />Last week, the US government approved a <a href="http://blogs.edmunds.com/greencaradvisor/2009/09/fisker-scores-528-million-loan-from-feds-for-next-generation-plug-in-hybrid.html">$528 million loan</a> from the U.S. Energy Department to Fisker Automotive Group, a start up automotive company based in California.<br /><br />The car Americans are investing in costs $89,000, reach top speeds over 150MPH and go 330 miles without a charge.<br /><br />A Toyota Prius for the UBER rich.<br /><br />Production is being planned in Finland some 4200 miles away from Washington DC.<br /><br />But no worries folks, the 528 million are part of the billions in TARP funds we put on the coffee table sometime last November.<br /><br />They say good things happen to those that show up... Fisker wasted no time, with check in hand even Walt Disney couldn’t top the joy Fisker executives experienced on their way home.<br /><br />This is Robb LoForeseUnknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-19884070922163584542009-10-13T12:40:00.004-04:002009-10-13T12:43:52.050-04:00WTBQ - "Our Town" Morning ShowWeekly WSA Feature - Each morning on WTBQ 1110AM and 99.1 FM<br /><br />October 13, 2009<br /><br />V.O.> Robb<br /><br />And now the wall street automotive report sponsored by Country Saab of Orange County<br /><br />What’s in a number? Well if you’re in the auto industry… numbers (after great products) are really all you have..<br /><br />Over the next few weeks, Ford Motor Company will announce its 3rd quarter results … and guess what .. <br /><br />Ford’s numbers will be very strong.<br /><br />That’s because a few years ago.. Ford’s great grandson hired Alain Mulany as his CEO and unlike many CEO’s on Wall Street; Mr. Mulany did exactly what Chief Executives are paid to do…<br /><br />Improve the numbers.<br /><br />And he’s just getting started… <br /><br />In the past investors talked of “blue chip” stocks, however today you would be hard pressed to find any formal definition..<br /><br />So please let me provide one.<br /><br />Blue Chip..<br /><br />Defined within a Big Blue Oval,<br /><br />Called Ford Motor Company.<br /><br />This is Robb LoForeseUnknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-91645760419696120192009-03-13T07:38:00.005-04:002009-03-13T07:43:45.749-04:00Executive Over-Exposure Takes Its TollSimilar to x-rays, executive over-exposure can kill you.<br /><br />Some executives know how to limit their time under the guy while others simply bask in the problems. Blame it on incompetent corporate communications, over-whelming personal ambitions, miss-trust of those around you or money, eventually the traffic in the rear view mirror becomes such a distraction, you simply can’t drive forward.<br /><br />When is it time to step down? When an executive is so over-exposed, their sheer presence fails to project the confidence needed to impact the organization any longer.<br /><br />Sadly however, beyond the satisfaction of “got <span class="blsp-spelling-corrected" id="SPELLING_ERROR_0">ya</span>” by those not supported, it hurts the organization for the simple reason it most likely took him/her so dam long to get there in the first place.<br /><br />But real talent knows when its time to step aside and let others carry on. Bill Ford comes to mind as a leader whose vision is indeed ahead of whatever title he holds. Having stepped aside as President / CEO, Mr. Ford is much more effective implementing strategies that go way beyond a daily sales pace.<br /><br />Finally the reward for stepping down becomes personal, the hope that younger executives you created along the way learn something from your courage and <span class="blsp-spelling-error" id="SPELLING_ERROR_1">isn</span>’t that what leadership is all about on the upper floors.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-3030382308460799672009-02-01T07:23:00.004-05:002009-02-01T07:39:37.398-05:00UpdatesPress Release - January 3, 2009 - Immediate release - The Times <span class="blsp-spelling-corrected" id="SPELLING_ERROR_0">Herald</span> Record, NY Times, Automotive News, MSNBC (web casts).<br /><br />The Wall Street Automotive Report daily format.<br /><br />Robb <span class="blsp-spelling-error" id="SPELLING_ERROR_1">LoForese</span>, editor/publisher - The Wall Street Automotive Report, will be broadcasting each mornings on <span class="blsp-spelling-error" id="SPELLING_ERROR_2">WTBQ</span>, NY Radio 1110AM / 99.1 FM on "Our Town" morning show. Robb <span class="blsp-spelling-error" id="SPELLING_ERROR_3">LoForese</span> states "The Wall Street Automotive Report segment will feature up to date news and <span class="blsp-spelling-corrected" id="SPELLING_ERROR_4">developments</span> on the Auto Industry - <em>from the Board Room - down to the car in your driveway</em>."<br /><br />Additionally Robb <span class="blsp-spelling-error" id="SPELLING_ERROR_5">LoForese</span> has teamed with Scott Valenti, an Investment Advisor creating a new radio show called "Wall Street, Main Street, Your Driveway" a full one hour news format, Saturday's 4PM - <span class="blsp-spelling-error" id="SPELLING_ERROR_6">WTBQ</span>, NY Radio 1110AM / 99.1 FM. Sponsors include Country Saab of Orange County and <span class="blsp-spelling-error" id="SPELLING_ERROR_7">PKS</span> Investments.<br /><br />Contact Robb <span class="blsp-spelling-error" id="SPELLING_ERROR_8">LoForese, WTBQ Studio </span>845-651-1110 or <a href="mailto:Rloforese@msn.com">Rloforese@msn.com</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-30898808730823182822008-12-14T10:14:00.008-05:002008-12-14T17:49:22.025-05:00Three Reasons, Three NosThe following is the audio transcript from “Wall Street Automotive” – <span class="blsp-spelling-error" id="SPELLING_ERROR_0">WTBQ</span> - NY Radio 1110AM / 99.1 FM – show dated December 13, 2008.<br /><br />Following a debate on loan guarantees for the big three:<br /><br /><span class="blsp-spelling-error" id="SPELLING_ERROR_1">VO</span>: Robb<br /><br />“As we all remember, in 1979-1980, Chrysler requested $1.5 billion in Federal loan guarantees. The structure of these Federal loan guarantees was underscored to provide "Chapter 11" type restructuring opportunities without its filling. [there was strings attached] Congress required Chrysler to obtain private financing for the $1.5 billion they were seeking (the government was co-signing the note, not printing the money) and Chrysler was also required to obtain another $2 billion in "commitments or concessions" for the financing of its operations. In essence most of Chrysler’s suppliers, union workers and contractors were forced to re-negotiate with Chrysler in order to assure their own viability. Some of Chrysler's suppliers accepted ten cents on each dollar rather than to loose Chrysler as a client.<br /><br />Lee <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Iacocca</span> stated openly "equality of sacrifice" and most Americans bought into his sales-man-ship, after all Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Iacocca</span> spoke not of a pending doom, rather he talked to the opportunities to lead and how each and every American can participate in his turn-around. The loan was paid, the K-Car and the Mini-Van was created and Chrysler was on a roll again and Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Iacocca</span> was an American hero.<br /><br />Today (concerning) Chrysler<br /><br />81% of Chrysler is owned by Cerberus Capital <span class="blsp-spelling-error" id="SPELLING_ERROR_5">LLC</span>, a privately owned company with over 100 billion dollars in assets. If you go to Cerberus' web page and read their mission statement its clear they are experts in turning under performing companies around, this is what they do, this is why they purchased Chrysler in the first place. It’s clear from Congressional hearings Chrysler's CEO Bob <span class="blsp-spelling-error" id="SPELLING_ERROR_6">Nardelli</span> has made no effort to tap into Cerberus capital quoting “loaning money to Chrysler would represent a conflict of interest with other Cerberus investments”.<br /><br />Back in July 2008, when the price of oil started to escalate, Chrysler had over 71% of its production focused on trucks and SUV type vehicles, Chrysler's only objective was to make fast money, paying less attention to customer driven products, quality and its own future.<br /><br />Giving Chrysler federal government money without the parent company participating, flat out no.<br /><br />(concerning) General Motors:<br /><br />This is easier, let’s just outline the following brands: Pontiac, Buick, Saturn, Hummer, and <span class="blsp-spelling-error" id="SPELLING_ERROR_7">GMC</span>. GM may be illustrating different brands representing different social milieus, however the truth is GM’s real reasons for its many brands was focused on the rewards of critical mass, shared platforms, common components - looking ahead only to increase its operating margins. GM’s critical mass approach became obvious to most consumers back in the mid 1970's and became chronic in the 1990's as overlapping <span class="blsp-spelling-error" id="SPELLING_ERROR_8">carlines</span> between its brands became more and more obvious.<br /><br />Sometime during the early 2000's GM tried to turn this around, however most consumers simply got tired of waiting and found Honda's, Toyota's and other Asian brands most welcome to fill their automotive needs.<br /><br />The loss of consumer brand loyalty between <span class="blsp-spelling-error" id="SPELLING_ERROR_9">GM's</span> divisions was rapid, and continues to this day.<br /><br />Giving General Motors federal government money without a clean sheet business plan, flat out no.<br /><br />(concerning) Ford Motor Company:<br /><br />Without going into too much detail here, I have the most faith in Alan <span class="blsp-spelling-error" id="SPELLING_ERROR_10">Mulally</span>, an outsider to the auto industry. Ford has capital today only because it borrowed some money last year. Ford is a smaller "ocean liner" in the automotive sea and can maneuver faster even during these turbulent times.<br /><br />Ford appears stronger; however their appearance is more about their financial condition rather than their products or consumer demand. So short term Ford looks like it has some viability, however the next 24 months future car launches will prove their real strength. The most successful, efficient and modern automotive assembly plant is owned by Ford in Brazil, look for this trend to continue.<br /><br />Additionally, I anticipate Ford will sell Volvo within 60 days, this will raise $3 - $4 billion dollars to the balance sheet, at the same time anticipate a more robust common stock as well, as GM share holders flee to more stable ownerships.<br /><br />Giving Ford federal government money when they haven't really asked for it, flat out no.<br /><br />So there it is, three reasons, three <span class="blsp-spelling-error" id="SPELLING_ERROR_11">nos</span>.<br /><br />Without loans anticipate Chrysler being the first to go Chapter 11, Cerberus shows least sincerity and care and Bob <span class="blsp-spelling-error" id="SPELLING_ERROR_12">Nardelli</span> (the same person that almost drove Home-depot to the ground) is (in my opinion) a terrible leader.<br /><br />GM will survive - Chevy is <span class="blsp-spelling-error" id="SPELLING_ERROR_13">GM's</span> Honda if managed properly. GM will be smaller, leaner, more global than ever before, it may take some time and some relocation of assembly plants, but I'm confident GM will be around for another 100 years.<br /><br />As discussed Ford appears to have already taken some measures on a turn around, suppliers and UAW negotiations will hang on Chrysler and <span class="blsp-spelling-error" id="SPELLING_ERROR_14">GM's</span> fate”.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-76484181412244156742008-12-05T21:52:00.003-05:002008-12-05T22:06:36.032-05:00Automotive Hula-hoopsThe day before GM met with congress, GM provided the complete Congressional presentation to all its dealers.<br /><br />Before I opened the file I froze and thought …<br /><br />”This has to be the most powerful presentation ever created by man. Few can imagine the force of GM gathering the best and the brightest, all focused on a single mission, create the most compelling argument ever made in order to survive. High fives must have been flying across the room, “we will blow them away” cheers in its development.”<br /><br />Then I opened the file…<br /><br />Scrolled down,<br /> Down,<br /> Down further…<br /> Something to the effect of “With / without loans”<br /> “Dismal forecasts”, “Car that can go 40 miles”<br /> Shure, shure, shure… keep reading, reading…<br />and then …<br /><br />The End.<br /><br />Ok, one more time maybe I missed something.<br /><br />But it wasn’t there.<br /><br />Then I thought of the movie Hudsucker Proxy, a young Tim Robbins pitch “you know for kids” as he tries to sell the hula-hoop to an aging board of directors.<br /><br />I guess I was hoping for a hula-hoop in GM’s presentation (replace with Ford or Chrysler at any time) something that would attract younger buyers, those who care more about text messaging and global warming than horse power. <br /><br />For younger car buyers, the big three’s pitch to congress must be like watching CBS, NBC and ABC defend itself from You-tube.<br /><br />I know it’s not polite to ask, but we can conclude (by observations alone) that most automotive executives are over 45 years of age (congressional folks as well).<br /><br />Experience is great, however without an injection of aspiration and enthusiasm from a diverse talent pool, automotive hula-hoops like the Model A, Cadillac V8 and Mini Van, would have never been created.<br /><br />Detroit has tons of white paper ready to pen the next MB A-class, VW TDI, and Smart cars but unfortunately congress (and the public) see Mustangs, Camaros and Challengers.<br /><br />Suggestion for the big three if there is a round three.<br /><br />Do WorkUnknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-9436038121041914072008-10-10T21:57:00.011-04:002008-10-10T22:37:44.739-04:00Keeping up with the Jones<div align="justify">The only real economic recovery after 9.11 was due to a real estate boom. The real estate boom was due to the creation of sub-prime mortgages. The sub-prime mortgage boom was due to the creation of high yielding debt securities. The debt security boom was created and sold by investment banks. The investment bank boom was the result of our economic recovery after 9.11.<br /><br />Since 9.11 America lost its air-line industry, automotive industry, banking industry (and most recently) economy. Americans lost sons, daughters, brothers, sisters, husbands and wives.<br /><br />The rise and fall of the Dow Jones since 9.11 took 7 years. The war of 9.11 was lost after the first few hours. <br /><br />Presidential canidates shadow an American tragedy.</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-28328939769282365032008-09-22T06:34:00.003-04:002008-10-02T21:15:17.811-04:00Future Editorial September 22, 2020“Your Shoelace is untied”<br /><br />It’s a famous line, you're looking ahead and something takes you off track and wallops you down.<br /><br />That’s what happened to GM, Ford and the former Chrysler Corporation in CY 2008 when suddenly without notice the price of crude oil sky-rocketed towards the $150 per barrel mark, as brokers (based in London) speculated short positions on oil indexes without any regulation - other than those of greed.<br /><br />Thus with the cost of oil rising almost out of control, Detroit’s big 3 slashed truck production, planned smaller fuel efficient cars and laid off thousands of workers.<br /><br />Former President <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Obama</span>’s “Big 3 Bail or Fail” plan of 2009 accelerated the demise of US auto makers by providing tax credits for smaller unprofitable cars at a time when US and Global oil production started its steady rise as China, India and Russian economies slowed during the mid 10’s.<br /><br />US <span class="blsp-spelling-corrected" id="SPELLING_ERROR_1">Alaskan</span> Oil (symbol “<span class="blsp-spelling-error" id="SPELLING_ERROR_2">USAO</span>”) and former Vice Presidential candidate Sara <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Palin</span> stated “back in 2008 US politicians sold the American public on global warming scams and sheer oil shortages because of increasing world demand. We now know the gas crisis of 2008 was nothing more than manipulation and unfortunately the former Big 3 automakers suffered the worst”.<br /><br /><span class="blsp-spelling-error" id="SPELLING_ERROR_4">Kia</span> Motors (Ford's Parent Company) CEO Mark Fields stated today that “as long as large US cars and trucks get over 35 MPG and the price of gas stays at $5.95 per gallon we see no need to plan smaller car and truck platforms for the US market any time soon. We learn by our mistakes”.<br /><br />Brent crude oil closed today at $125 a barrel – its lowest levels since 2014 this at time when wind power tax credits have peaked with little or no new wind energy farms on the horizon.<br />------------<br /><br />Well its possible!!!Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-67611206416020873542008-08-31T22:05:00.009-04:002008-09-01T10:11:38.944-04:00MADE menI really don’t know much about the Mafia other than watching movies and growing up in Brooklyn. I’m told that once you’re confirmed as being MADE your untouchable, no one can kill you without clearing the request at the highest levels of the organization. In fact, just the mention of killing a guy who is MADE can get you killed because MADE guys are… well …made.<br /><br />The Auto Industry has MADE men (including both genders). Corporate MADE men beg the question ...how is it <span class="blsp-spelling-error" id="SPELLING_ERROR_0">possible</span> they still continue to run the show or be employed ?<br /><br />How do you spot a MADE man at your place of business ?<br /><br />Seek those who keep making the same speech over and over again, have a vocabulary of 15 – 20 buzz words, dress to attract people to an image rather than a substance and likes floating around lunch rooms asking rank and file folks “what’s going on”.<br /><br />The MADE man is also the person the advertising agency invites to presentations, movie premiers, golf outings and “on location” commercial productions.<br /><br />At dealer meetings MADE men represent cocktail safety zones, no real business conversations, no real questions about dealer profitability, just easy - happy talk.<br /><br />Seriously thought, the auto industry can’t afford MADE men any longer. MADE men represent excess, a failed strategy, an expense that just can’t be justified. Left untouched or uncorrected, MADE men consume six and seven figure assets at a time when corporate burn rates exceed ten figures.<br /><br />October 08’s Automobile Magazine has an interesting story on page 154. The person featured could easily be the poster child for every MADE man “want-a-bee” out there.<br /><br />Get your popcorn ready, I’m thinking God Father IV.Unknownnoreply@blogger.com3tag:blogger.com,1999:blog-510791902015800748.post-67909801045909630182008-08-03T22:39:00.007-04:002008-08-06T07:52:09.901-04:00Tragic Communications - Winners and LosersIn 1979 Chrysler’s Lee <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Iacocca</span> stated the failure of Chrysler would be an American tragedy, something all US citizens needed to rally around. “Bail out or bust” were the headlines and if anyone knew how to rally the troops it was the <span class="blsp-spelling-error" id="SPELLING_ERROR_1">likeable</span>, charismatic personality of Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Iacocca</span>.<br /><br />Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Iacocca</span> lead customers into the showroom with $50 test drive offers that were simple and sincere… “Buy a car, get a check” consumers became the beneficiary. <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Iacocca</span>’s style never lead on “the end was near”, rather he communicated what would be and how each and every American can participate in the company's turn-around.<br /><br />Twenty Nine years later Chrysler is struggling, and with diminishing cash reserves, all domestic brands are on life support, however unlike 1979, few public and political “get well cards” are sent.<br /><br />Today (for the most part) Americans view domestic leaders as hidden elitists, placing profits ahead of its customers.<br /><br />Maybe public opinion is absorbed from the simple fact of how the big 3 communicate.<br /><br />Recent announcements to “take back” attractive consumer leasing programs were communicated as “in your face”, “take that” type punishment to loyal customers everywhere.<br /><br />Honda's CEO kicks back his chair in a pose resembling Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_5">Iacocca's</span> book cover... the title of the book "Thank you".<br /><br />Editors note: Exception to Mr. Bill Ford Jr.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-147001697152982762008-06-19T23:30:00.005-04:002008-06-22T20:50:00.644-04:00The Fool On The HillTwenty four hour news formats have most people believing the reason for higher gas prices is due to rising global demands of crude oil and American’s dependence of imported oil – especially from OPEC nations.<br /><br />Demand for fuel in China is the best smoke-screen. It’s easy to visualize masses of people on bicycles now driving Cadillac’s with 2 car garages – thus Americans can conclude “it’s out of our control” so just pay the price.<br /><br />For those just awaking ….there is a small square bock of real estate in Manhattan called Wall Street, the buildings there (and in similar markets throughout the globe especailly London); control the world’s financial conditions good, bad or indifferent.<br /><br />The Street forecasts<br />The Street invests<br />The Street controls<br /><br />Pay $5.00 for a gallon of gas … The Street wins.<br /><br />I’ll explain.<br /><br />Let’s say a group of investors concocted a strategy where it buys future stockpiles of medical equipment to price levels where the average American or Health Care provider couldn’t pay the cost any longer. One day the price of an x-ray is $100 the next day $800 and the next day $1500 – Americans would be outraged!<br /><br />Over the past 25 years the price of oil and the price of a gallon of gas were paired, both rising, but matched in even parallels. Since 2002 the price of oil disconnected itself from the price of gas like a run-a-way train, the spread is alarming, if it were a cardiogram the patient would have already died.<br /><br />Index Speculators claimed their territory post September 11, fueled by Institutional Investors, Mutual funds and University endowments… Index Speculators have become as critical to world oil markets as China, both place equal amounts of pressures to continue the rise in oil prices. The key difference is Index Speculators buy “oil indexes” and China buys the “actual commodity”.<br /><br />As more Oil Index Speculators…”speculate”… the sheer mass of long positions assure higher prices.. the unsupervised frenzy feeds itself.<br /><br />Could the oil bubble burst? Possibly.. however traditional supply and demand models are paralyzed – eight fold price increases in any commodity over an 8 year period doesn’t increase demand it reduces it (yes even with China consuming more oil). Thus increasing oil production won’t work because we already have an oil surplus.<br /><br />The only remedy is to eliminate Index Speculation on all commodities. Without Index Speculation investor risk is tied into an obligation to cover short positions by buying the actual commodity, thus placing the focus on real supply and demand swings. Till then Index Speculators remain the core reason Oil and Food prices continue to increase.<br /><br />The fool on the hill sits alone but has the ability to see the big picture.Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-510791902015800748.post-14513094244057126722008-04-24T22:56:00.003-04:002008-04-26T23:04:35.247-04:00Key PoliticsSome time ago an ignition key was born. A silver key with no remote nor batteries to slow it down, even the key ring found itself an orphan.<br /><br />The key fit perfectly in many situations, small cars, big cars, fast cars, slow cars. The key was responsible for igniting 2 cycle and 4 cycle motors and grew to ignite the economy. Sometimes keys lost their ways, however technology advancements made it possible to clone another.<br /><br />--------<br /><br />Uniting what would become a political passion play, keys are blamed for melting ice-burgs and raising sea levels, and most important, winning elections.<br /><br />John Coleman, founder of the Weather Channel, stated Global Warming is “the greatest scam in history …and nothing more than a political platform”.<br /><br />Pros/cons alike there are just too many keys that open back doors of beach homes, private jets, eight car garages, and SUV caravans.<br /><br />The Global Warming pitch has stalled.<br /><br />Keys rejoice.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-43269005896184253882008-04-01T22:01:00.087-04:002008-04-26T22:59:12.431-04:00American InnocenceThe origins of oil production in the United States can be traced back to <span class="blsp-spelling-error" id="SPELLING_ERROR_0">Titusville</span>, Pennsylvania 1859. John D. Rockefeller turned oil into a “Standard” household name.<br /><br />The origins of oil production in the Middle East can be traced back to Persia in 1908. King <span class="blsp-spelling-error" id="SPELLING_ERROR_1">Ibn</span> <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Saud</span>, founder of modern Saudi Arabia was somewhat understated in his quest for oil.<br /><br />Early Saudi oil production was similar to hosting a dinner party... foreign dignitaries came hungry and the Middle East was quick to learn how to entertain.<br /><br />One Ford assembly plant and industrial revolution later, America's appetite for oil increased dramatically. World War I and II would prove to be the "coming out" parties for oil as a strategic tool - however it would take a Baby Boom to define oil as a real means to enjoy life.<br /><br />The term "oil crisis" was founded in 1973 - members of OPEC announced, as a result of the <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Yom</span> <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Kippur</span> War, they would no longer ship oil to nations who had supported Israel in its conflict with Syria and Egypt.<br /><br />Gas lines formed – American’s demanded answers!<br /><br />Then, like a passing thunderstorm, the lines stopped and oil shined upon us once again.<br /><br />The 1979 (or second) oil crisis began in the wake of the Iranian Revolution and the Ayatollah Khomeini taking control. The <span class="blsp-spelling-error" id="SPELLING_ERROR_5">Ayatollah's</span> immediate interest <span class="blsp-spelling-error" id="SPELLING_ERROR_6">wasn</span>’t oil, so he shut it down and unwittingly started a widespread panic among Saudi Arabia and other OPEC nations. The immediate concern was Iran's stability and willingness as an oil partner. As Mid East oil production stalled - prices rose and shortages, either planned or accidential, <span class="blsp-spelling-error" id="SPELLING_ERROR_7">were </span>on the horizon.<br /><br />Gas lines formed and once again American’s demanded answers!<br /><br />Then, as before, the lines stopped and oil was everywhere.<br /><br />Today, April fools day, Congress met with top executives of the country’s five biggest oil companies and pressed them to explain why they should continue to get billions of dollars in tax breaks when they made $123 billion last year and motorists are paying record gasoline prices at the pump.<br /><br />Tomorrow we shall demand answers!<br /><br />American innocence is applauded, the era of cheep oil is over.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-30586351844038170862008-02-29T22:56:00.007-05:002008-03-01T10:59:55.637-05:00Consumer ReportsI guess if you don’t have an uncle in the business, or high speed internet connection, you need a book that tells you what to buy and what not to buy. However in my opinion CR gets the "duh" award for automotive reviews with "Captain Obvious" editorials for the masses of consumers who rely on a 3rd party publication to justify their purchase decision.<br /><br />I wonder if CR would have liked some of our past automotive icons.... let’s have some fun.<br /><br />“CR circa October 1963”<br /><br />"The GTO is simlpy a Tempest with a large engine. The extra weight felt heavy on the steering box and handling was slow and non-responsive. The added hood scoop is not functional and the extra badging on the rear quarter panels appeared too large for the car. The dual exhaust, although functional, adds weight and future expense to replace. We liked the bucket seats, but for better value we would option for the LeMans with the more efficient 6 cylinder. Because of the poor gas mileage we cannot recommend the model."<br /><br />"CR circa April 1964"<br /><br />“The Mustang is an all new car by Ford, although built off the Falcon platform; the car is lower and more stylish. Rear seat room is very tight and the doors are large and hard to control when opening. Trunk space in inadequate for a family of four, however front leg room is impressive. No crash results are available at printing. We prefer the larger platforms from Ford like the Galaxy – providing more value and comfort. Overall we like the car; however the $2330 starting price is not competitive with models offering more features.”<br /><br />Here’s one – The 1970 Plymouth Super Bird<br /><br />“When the Plymouth Super Bird was delivered staffers at CR were aghast, the poorly designed front end and excessive rear spoiler blocked parking views in tight spaces. Fit and finish was horrible. We quickly realized why these limited edition cars are sitting in Detroit unsold. The Super Bird although a replica of a race car is truly not practical for daily shopping chores or weekend drives. Most CR staffers found the extra nose hard to judge in traffic and anticipated difficulty in accessing simple maintenance items such as fan belts and light bulbs. Crash results are impressive because of the extended bumper. We recommend the standard Plymouth Belvedere for value and functionality.”<br /><br />In 2007 Consumer Reports didn't recommend the Lexus LS and in 2008 it’s on their top ten lists. How is it possible that CR doesn’t recommend Volvo as the safest car made or that (overall) a Corvette should be recommended to anyone always wanting to own such an icon.<br /><br />Bottom line, hidden agenda’s are everywhere, in this article I’m making it clear I don’t like CR because of their inconsistencies of cars liked and disliked; their circle rating system drives me crazy (how can a car have so many red dots and still not be recommended?). But most of all I dislike the hard line sales pitch for printed materials in the age of free Google searches.<br /><br />Yes an educated consumer is a great customer. Read, study but most important go to the dealership and drive the car. If the car fits like a really nice suit and you feel very comfortable in it, then buy it, the reality is no one builds a bad car any longer and not everyone wants to be seen wearing a CR “Best Buy” baseball cap (only $5.95 plus shipping).<br /><br />EditorUnknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-42177294108817745662008-01-27T21:10:00.000-05:002008-01-28T07:34:50.291-05:00"Straight Ahead" and other Fairy TailsI'm a firm believer in history and trends.<br /><br />In the 60’s people woke up, drank coffee, bought a local newspaper, went to work, came home, watched some TV and went to bed.<br /><br />In 2008 people still wake up, click on e-mail, check cell phone messages, watch <span class="blsp-spelling-error" id="SPELLING_ERROR_0"><span class="blsp-spelling-error" id="SPELLING_ERROR_0">MSNBC</span></span>, buy coffee, watch <span class="blsp-spelling-error" id="SPELLING_ERROR_1"><span class="blsp-spelling-error" id="SPELLING_ERROR_1">Ipod</span></span> casts, go to work, log onto news formats, search Google, drive home viewing <span class="blsp-spelling-error" id="SPELLING_ERROR_2">NAV</span> systems, check e-mail, check cell phone messages, watch a reality show, take one more peek at e-mail and get to bed.<br /><br />Yes information is king and if we believe bad news sells, then 24 hour news formats can be a windfall.<br /><br />The most simplified definition of Economics pivots on attitude.<br /><br />Believe times are bad you hold back.<br />Believe times are good you spend.<br /><br />A recession vaulted soon after 9/11 and for really good emotional reasons.<br /><br />By November 2001 GM launched zero percent, Chrysler and Ford jumped in, and the Federal Reserve Bank participated as well. Within 10 months 24 hour news makers were forced to called it a "mild" recession because they lost the key battle and really hated to loose the powerful "recession" tag line.<br /><br />Now it’s January 08, 25 days after New Years, just 6 months since the Dow peaked at 14000... its cold, winter and election time.<br /><br />Twenty Four Hour news require sprints of “breaking news”, "this just in", “up next” and “later on” type leading formats to capture its viewer.<br /><br />How to fill the time?<br /><br />The revenue makers are played out, <span class="blsp-spelling-corrected" id="SPELLING_ERROR_3">Hurricane's</span>, The Iraq war, Bush bashing, the election and <span class="blsp-spelling-error" id="SPELLING_ERROR_4">Britney</span> Spears, even the award winning named "Jenna 6" failed to launch.<br /><br />What's a 24 hour news format to do????<br /><br />Reach for the "fire box" of news stories, the always reliable, hard hitting "Household survey":<br /><br /><strong>Question:</strong><br /><strong> </strong>“Now that we are in a recession and the stock market is tumbling do you plan to spend your money?”<br /><br /><strong>Household answer:</strong><br />"No"<br /><br />With glee CNN reporter Kelly <span class="blsp-spelling-error" id="SPELLING_ERROR_4"><span class="blsp-spelling-error" id="SPELLING_ERROR_5">Lookingood</span></span> (who majored in art and fashion design) reports:<br /><br />“The latest consumer survey is in and it’s a lot worse than <strong>I</strong> already predicted… 100 households surveyed if they plan to spend money this year and the answer was Absolutely NOT. All agreed that the stock market is tumbling and we are indeed in a recession”.<br /><br />With a sudden 3/4 drop our new Fed <span class="blsp-spelling-corrected" id="SPELLING_ERROR_6">Chairman</span> proves he has an eye for news. Detroit sees it as just another January, their 16 inch incentive guns sit idle but not without ammunition.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-59823963942860342522007-12-21T22:06:00.000-05:002007-12-22T10:32:43.932-05:00Trading Made SimpleDateline December 21, 2007, masses of automotive incentive forces have been taken back to the boarders, reduced production is planned. “We will not fight” acclaim Automotive Executives. Analysts are quick to publish reports on a more mature, financially driven industry, using buzz words like “market driven”, "ordered pipelines" and “Value Priced Products”.<br /><br />But wait this is December.<br /><br />----------<br /><br />For those new to how automotive companies plan their calendar year, allow me to illustrate each month – along with the appropriate stock order.<br /><br /><strong>Jan. - Buy</strong><br />The big picture always begins at the Detroit Auto Show, where Automotive CEO’s from all corners of the globe project the promise of new markets, new segments and new profits. Most (if asked) underestimate first quarter forecasts. Keeping in mind this is Detroit and the month is January, most agree and go home, finding frozen inventories and little revenue.<br /><br /><strong>Feb. - Hold</strong><br />Ok a little push back from Wall Street on poor January results, no need to over-react its still February. Dealer meeting frenzy time - present confidential plans for a March close out – push new orders now, with the promise of increased incentive spending sometime around (pick a date).<br /><br /><strong>Mar. - Sell<br /></strong>Hoping no CFO will notice, quietly borrow from fourth quarter incentive budgets and launch a March close out blitz, off-set spendings with increased wholesale gains and surprise Wall Street with a stronger than anticipated first quarter result.<br /><br /><strong>Apr. - Buy</strong><br />Follow January (different auto show / same story)<br /><br /><strong>May - Hold<br /></strong>Follow February<br /><br /><strong>June - Sell</strong><br />Follow March<br /><br /><strong>July – Buy<br /></strong>Similar to April<br /><br /><strong>Aug. – Hold</strong><br />Similar to May<br /><br /><strong>Sep. – Sell<br /></strong>Yes it's June again<br /><br /><strong>Oct. – BUY</strong><br />New model launch.<br /><br /><strong>Nov. – Hold<br /></strong>Short month - no one pays attention.<br /><br /><strong>Dec. – SELL</strong><br />Ran out of money, talk advertising / first quarter plans.<br /><br />Ok now you know the secret – you can send me the commissions.<br /><br />Happy Holidays.<br /><br />Editor.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-7620663674000109602007-12-07T21:15:00.000-05:002007-12-08T22:43:28.916-05:00A New DealLast week, Automotive Stock Analysts down-graded the outlook for Publicly Traded Dealer Stocks (i.e., Auto Nation, <span class="blsp-spelling-error" id="SPELLING_ERROR_0"><span class="blsp-spelling-error" id="SPELLING_ERROR_0"><span class="blsp-spelling-error" id="SPELLING_ERROR_0">Asbury</span></span></span>, Group 1) explaining that both the economy and auto sales were going to decline in 2008.<br /><br />Wall Street analysts were indeed right about short siding Publicly Traded Dealer Stocks (“<span class="blsp-spelling-error" id="SPELLING_ERROR_1"><span class="blsp-spelling-error" id="SPELLING_ERROR_1"><span class="blsp-spelling-error" id="SPELLING_ERROR_1">Publics</span></span></span>”), however for the wrong reasons. Sure it’s the economy that fuels the appetite for car sales, but for <span class="blsp-spelling-error" id="SPELLING_ERROR_2"><span class="blsp-spelling-error" id="SPELLING_ERROR_2"><span class="blsp-spelling-error" id="SPELLING_ERROR_2">Publics</span></span></span>, sheer sales increases can’t save an overall defunct business model.<br /><br />If you view <span class="blsp-spelling-error" id="SPELLING_ERROR_3"><span class="blsp-spelling-error" id="SPELLING_ERROR_3"><span class="blsp-spelling-error" id="SPELLING_ERROR_3">Publics</span></span></span> in similar way you view (and invest in) large “box” retailers you will find three key differences:<br /><br />1. <span class="blsp-spelling-error" id="SPELLING_ERROR_4"><span class="blsp-spelling-error" id="SPELLING_ERROR_4">Publics</span></span> can't receive discounts for large stock orders.<br />2. <span class="blsp-spelling-error" id="SPELLING_ERROR_5"><span class="blsp-spelling-error" id="SPELLING_ERROR_5">Publics</span></span> are restricted to sell only one brand per facility.<br />3. <span class="blsp-spelling-error" id="SPELLING_ERROR_6"><span class="blsp-spelling-error" id="SPELLING_ERROR_6">Publics</span></span> can't profit from the sale of their new products.<br /><br />Think about it, <span class="blsp-spelling-error" id="SPELLING_ERROR_4"><span class="blsp-spelling-error" id="SPELLING_ERROR_7"><span class="blsp-spelling-error" id="SPELLING_ERROR_7">Wal</span></span></span> Mart can buy 50,000 tubes of tooth paste for one quarter of the cost to your local drug store and then profit off any brand a consumer chooses, all displayed on the same shelf.<br /><br />In automotive retailing, a dealer who sells five cars a month buys products for the same price as a dealer who sells 100 cars per month. <span class="blsp-spelling-error" id="SPELLING_ERROR_8">Publics</span> become large by <span class="blsp-spelling-corrected" id="SPELLING_ERROR_9">committing</span> to exclusive brand offerings (especially in expensive major markets) and then report significant <span class="blsp-spelling-corrected" id="SPELLING_ERROR_10">losses</span> in their new car departments. Sure there are exceptions, but unless everyone drives Toyota, Honda, BMW and Lexus brands the retailing business model will remain seriously flawed.<br /><br />The only "real" value <span class="blsp-spelling-error" id="SPELLING_ERROR_11">Publics</span> have is real estate. Steer clear of <span class="blsp-spelling-error" id="SPELLING_ERROR_6"><span class="blsp-spelling-error" id="SPELLING_ERROR_9"><span class="blsp-spelling-error" id="SPELLING_ERROR_12">Publics</span></span></span> who pay more rent than mortgage (thus funneling rents to <span class="blsp-spelling-corrected" id="SPELLING_ERROR_13">separate</span> <span class="blsp-spelling-error" id="SPELLING_ERROR_7"><span class="blsp-spelling-error" id="SPELLING_ERROR_10"><span class="blsp-spelling-error" id="SPELLING_ERROR_14">LLC</span></span></span>’s - more of this at a later time).<br /><br />The future of automotive retailing does indeed belong to big investors and CEO’s with vision and leadership (common traits of most <span class="blsp-spelling-error" id="SPELLING_ERROR_9"><span class="blsp-spelling-error" id="SPELLING_ERROR_12"><span class="blsp-spelling-error" id="SPELLING_ERROR_15">Publics</span></span></span> today). However only those <span class="blsp-spelling-error" id="SPELLING_ERROR_10"><span class="blsp-spelling-error" id="SPELLING_ERROR_13"><span class="blsp-spelling-error" id="SPELLING_ERROR_16">Publics</span></span></span> strong enough to lobby changes in franchise laws and distribution policies will prevail. Imagine <span class="blsp-spelling-error" id="SPELLING_ERROR_11"><span class="blsp-spelling-error" id="SPELLING_ERROR_14"><span class="blsp-spelling-error" id="SPELLING_ERROR_17">IKIA</span></span></span> sized retail facilities where customers can view products and services in the same way one clicks onto the <span class="blsp-spelling-corrected" id="SPELLING_ERROR_12">Internet</span>.<br /><br />If you must sell <span class="blsp-spelling-error" id="SPELLING_ERROR_13"><span class="blsp-spelling-error" id="SPELLING_ERROR_15"><span class="blsp-spelling-error" id="SPELLING_ERROR_18">Publics</span></span></span>, sell because the business model is as out of date as the leaf springs I saw today on the new Hummer H3.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-48636664963675355962007-11-28T07:09:00.000-05:002007-11-28T07:34:46.879-05:00Harvest TimeThe earth is shaking; it’s a small rumble but a rumble just the same.Over 77 million adults are getting old fast.<br /><br />Just like a tsunami, the first wave of boomers (13 million consumers) is turning 60 within the next 2 years and they plan to buy automobiles. And if you think this group loves cars…wait till the largest group of boomers, 23 million born 1960 – 1964, come of age!<br /><br />Just like the anticipated real estate trend to smaller homes with larger luxuries, the car industry needs to reflect if they are indeed prepared to harvest this market of “last chance” personal indulgence.<br /><br />A return to personal luxury.<br /><br />Bill Mitchell best defined personal luxury about the same time boomers were just kids. Overtime boomers grew up with the appreciation that “one earns - what one drives” and aspirational brands such as Cadillac, Lincoln and Chrysler represented the pinnacle of life’s success. Now, 40 years later, it’s reasonable to conclude boomers are seeking the same status and identification in today’s brands—the same way one rediscovers an old friend. But sadly, with few exceptions, no one has responded.<br /><br />Forget hip-hop, race wins and wheel spinners, personal luxury is not a four door, nor a cross- over vehicle or even a <span class="blsp-spelling-error" id="SPELLING_ERROR_0"><span class="blsp-spelling-error" id="SPELLING_ERROR_0">Hemi</span></span>.<br /><br />Imagine.. a high performing V8 hybrid. long hood, short deck, riding on a soft, but highly tuned and adaptive chassis, fitted and formed aircraft type seats, highly detailed exteriors and interiors, and an overwhelming use of quality materials (and craftsmanship) not seen since the 1930’s (i.e., triple chromed accents, real wood, leather, brass and stainless steel).<br /><br />Price? Well it’s not about monthly payments… Don’t forget room for golf clubs, ease of entry and exit, slightly larger read-outs, and a very very cool audio / DVD system - grandchildren need to be impressed in order to keep the cycle moving to the next generation.<br /><br />Editor: Bill Mitchell's legacy is as forgotten as a <span class="blsp-spelling-corrected" id="SPELLING_ERROR_1">Google</span> search for his photo - shame on us.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-510791902015800748.post-88988597957298227322007-11-19T14:57:00.000-05:002007-11-19T15:02:10.447-05:00A Short StoryIn the fall of 1971 shortly after taking the helm of <span class="blsp-spelling-error" id="SPELLING_ERROR_0">VW</span>, Rudolf <span class="blsp-spelling-error" id="SPELLING_ERROR_1">Leiding</span> had only one comment to the press, “we have to work first, let us do so, we shall talk later”. <span class="blsp-spelling-error" id="SPELLING_ERROR_2">Leiding</span> rising from the ranks of apprentice mechanic to Chairman was no youngster.<br /><br />At 58 years of age Mr. <span class="blsp-spelling-error" id="SPELLING_ERROR_3">Leidling</span> was faced with a serious crisis, saving <span class="blsp-spelling-error" id="SPELLING_ERROR_4">VW</span> while air cooled engines were quickly coming to the end. The causes of <span class="blsp-spelling-error" id="SPELLING_ERROR_5">VW</span>’s problems are similar to today, monetary measures supported by a strong Yen and the need to reach critical mass as a global marketer. By 1972 <span class="blsp-spelling-error" id="SPELLING_ERROR_6">VW</span>’s monthly sales were cut in half – not even fleet sales can be sited as the cause.<br /><br /><span class="blsp-spelling-error" id="SPELLING_ERROR_7">Leiding</span> is quoted as saying:“The immediate problem was not to make money on the American market, (but) to keep that market, to maintain our exceptional US dealer network and to keep our factories busy”*. It was very rare to find <span class="blsp-spelling-error" id="SPELLING_ERROR_8">Leiding</span> at press events; rather he was known to stand by the factory gates to monitor those arriving late for work. Product model policy (as it was called back then) was his first priority. <span class="blsp-spelling-error" id="SPELLING_ERROR_9">Leiding</span> cut projects that were soon to be “job one” saying:"It was better to loose a little money right away than loose a lot later on”.<br /><br /><span class="blsp-spelling-error" id="SPELLING_ERROR_10">Leiding</span> also cut costs and manufacturing, his big success was defining Audi and <span class="blsp-spelling-error" id="SPELLING_ERROR_11">VW</span>’s future brand rolls and finding synergies in design and platform sharing that lives on today.<br /><br />Rudolf <span class="blsp-spelling-error" id="SPELLING_ERROR_12">Leiding</span> .... from apprentice to Chairman – head hunters <span class="blsp-spelling-error" id="SPELLING_ERROR_13">didn</span>’t stand a chance.<br /><br />Editor:<br /><br />The moral to the story ... When given the opportunity to turn a company around, remember to grab the steering wheel.<br /><br />* March 1973 – Motor Trend / by Edouard <span class="blsp-spelling-error" id="SPELLING_ERROR_14">Seidler</span>.Unknownnoreply@blogger.com0