Thursday, February 28, 2008

Daimler bonus to LaSorda outlined


Total '07 pay worth about $20.7 million


Daimler AG paid Tom LaSorda a $15.7-million bonus for the successful sale of Chrysler to Cerberus Capital Management last August, filings with the federal government showed Wednesday.

LaSorda, who had been the top Chrysler executive under then-DaimlerChrysler AG, received in 2007 a total compensation package from Daimler worth about $20.7 million under Wednesday's exchange rate, according to the German company's filing with the U.S. Securities and Exchange Commission.

Cerberus, a private equity firm, acquired majority control of Chrysler on Aug. 4, leaving Daimler with just 19.9% of the Auburn Hills automaker.

The new filings also give a window into how Chrysler did during the first two months following the ownership change: Chrysler lost 1.9 billion euros -- or $2.9 billion under today's exchange rate, according to Daimler's annual report.

Much of that money -- $2.4 billion -- was related to restructuring measures and a new labor agreement with the UAW, which did not necessarily occur in those 8 weeks, the filings indicated.

The picture of how Chrysler did last year, however, is far from clear. There is a three-month reporting lag, the report said.

Chrysler on Wednesday night denied losing $2.9 billion in the two-month span -- saying it was, in fact, profitable in that period -- and said its losses in 2007 were "significantly less than 2.9 billion," according to Chrysler spokesman David Barnas. The automaker believes any differences are because of the difference between U.S. accounting practices and international accounting practices, which Daimler used.

German officials did not answer questions late Wednesday afternoon.

In November, Chrysler's new CEO Bob Nardelli said Chrysler was set to lose $1.6 billion, though he did not explain his accounting methodology.

Chrysler, as a private company, does not make its finances public, and its officials have said the benefit of being a private company is that it can focus on the long term, making decisions for future success.

"Since August and the return of Chrysler as an independent company, we have not only been meeting, but, in many cases exceeding all key metrics," Barnas said in a statement.

"Despite the challenges that lie ahead, Chrysler feels confident today that the company is poised on the threshold of full recovery," he added. "We are making the tough decisions for the long-term health of the company, our employees are fully engaged as we create an owner-operator mindset, and we are gaining momentum. In addition, Chrysler has a strong partnership with its parent company, Cerberus Capital Management, and has ample liquidity and is fully funded with working capital to meet its present and future needs and objectives."

Under Cerberus control, LaSorda was made president and vice chairman.

LaSorda's bonuses first drew criticism last fall while the automaker was in negotiations with UAW over a new labor agreement.

In recent weeks, UAW President Ron Gettelfinger has been vocal about the size of executive paychecks at the automakers, saying they need to make sacrifices along with the rank-and-file workers. The UAW agreed to a contract that allows new hires to so-called noncore jobs to begin making roughly half the wage of current workers.

Erich Klemm, the top German labor representative on DaimlerChrysler AG's supervisory board, called the bonuses to LaSorda and former Chief Operating Officer Eric Ridenour unreasonably high in a German newspaper last fall.

The exact amounts were not made public at the time.

Wednesday's filings show that LaSorda made 2.1 million euros in base salary, benefits, shares, stock and bonuses.

In addition, LaSorda was paid a 10.4-million euro bonus as part of a deal he agreed to that paid him "upon the successful transfer of a majority ownership interest in Chrysler to a third party." As part of the agreement, LaSorda, who was under contract until 2012, agreed to break the contract and waived his claim to severance and pension payments.

Daimler said, "The agreements were intended to facilitate a timely and successful transaction while at the same time defining the conditions for a retirement from the board."

LaSorda had been a member of DaimlerChrysler's management board.

In addition, LaSorda was paid 1.2 million euros for prorated payments of the phantom share awards previously granted to him. Phantom shares are basically a bonus plan under which the bonus amount is based on the value of the company's stock.

Similarly, Ridenour received a compensation package worth 5.4 million euros, or $8.2 million. His bonus for the Chrysler sale was $4.8 million.

Under Cerberus control, Tom LaSorda was made president and vice chairman of Chrysler.


This Day in Auto History:

Automobile Quarterly
Automobile Quarterly

George H. Ellis, a 26-year-old employee of the Deering Harvester Company, successfully tests his automobile in Ravenswood, IL, now a part of Chicago - although additional production was ruled out, this vehicle is considered to be the ancestor of the International truck
Racer Albert Scherrer is born in Switzerland
The Beverly Hills (CA) Board Speedway stages its first event, a 250-mile race won by Jimmy Murphy in a Duesenberg
Gordon M. Buehrig joins General Motors Styling
DeWitt Page, a Vice President of General Motors and former President of the New Departure Manufacturing Company, dies in Hialeah Park, FL at age 70

Source: Automobile History Day By Day, by Douglas A. Wick

Chrysler LLC Launches New Technical Programs

PRNewswire via COMTEX/ -- For decades, Chrysler LLC has offered specialized programs to help its technical talent build their skills and develop strong careers while at the same time helping the company to create incredible vehicles and powertrains -- and two of these programs are now getting even better.

The new Technical Fellow and Master Black Belt Senior Specialist programs will build on the company's existing Technical Specialist and Master Black Belt programs.

"Chrysler knows that engineering innovation and disciplined decision- making are vital to the success of the company," said Frank Klegon, Executive Vice President - Product Development, Chrysler LLC. "Technical Specialists and Master Black Belts are highly valued in this regard and are key to successfully carrying out our future product plan."

The Technical Specialist program has been in place at Chrysler since 1988. Technical Specialists are instrumental within the company's engineering community in several ways: They help develop state-of-the-art technology for Chrysler, they stay abreast of emerging technologies, and they share knowledge, as well as coach and mentor other engineers.

To be recognized as a Technical Specialist, engineers must meet criteria that includes education and experience, job performance and accomplishments, and a peer review. The new Technical Fellow program includes even tougher criteria, but provides recognition and new opportunities for career growth for engineers with extraordinary knowledge and experience.

Chrysler also is offering something new within the Master Black Belt program with a Master Black Belt Senior Specialist designation.

"The mission of the Master Black Belt program is to build on our culture of creating robust designs, rapidly solving problems, and ensuring the most efficient business processes are used throughout the organization," said Doug Betts, Vice President and Chief Customer Officer, Chrysler LLC.

Black Belts use different problem-solving methodologies, including Lean Six Sigma, Design for Six Sigma, Critical Thinking and Shainin Red X to solve various technical and process issues throughout each vehicle program. They progress through the Black Belt ranks to the current top rank of Master Black Belt Specialist. The new top rating of Senior Specialist demands tougher criteria, but provides greater personal recognition and reward -- and benefits to Chrysler's Product Development operations.

Engineering expertise and process driven methodologies are critical to Chrysler's ongoing success. The Technical Specialist and Master Black Belt programs provide a competitive advantage to the company by developing and implementing new technology, refining internal processes and identifying cost- savings opportunities. Both Chrysler and its talent base have a lot to gain from the new programs -- but the ultimate beneficiaries are Chrysler's customers.

Wednesday, February 27, 2008

Chrysler Pacifica being investigated by NHTSA for fires

Investigators for the National Highway Traffic safety Administration are taking a closer look at 2007 Chrysler Pacificas equipped with the 4.0-liter V6. There is a concern that the vehicles could be prone to engine bay fires. A cross-threaded power steering fitting that prevents proper sealing of the hydraulic system could be the root cause. Chrysler has received 166 warranty claims and 25 complaints reporting smoke and fire breaking out. NHTSA has also received three complaints, and the fires seem to be localized to the front of the vehicle, indicating that a power steering leak could indeed be to blame.

Chrysler is aware of the problem, which is specific to the 4.0-liter equipped Pacificas, and traced it to a tube nut on the high pressure power steering line. The nut was found to have been cross threaded when attached to the steering gear, which prevents the o-ring from sealing. Chrysler has put extra quality assurance and assembly processes in place to solve the problem. The automaker also explained that owners should monitor the level of power steering fluid and listen for a noisy pump; both telltale signs that offer a degree of early warning before the Pacifica goes up in smoke. If NHTSA continues to see a problem, a recall of the 2007 Pacifica could be imminent.

Thanks to Autoblog reader Thedevil (we don't make this stuff up) for the tip.


Oil falls from $102 on inventories, economy

Crude retreats from record high as supplies rise for 7th straight week and weak economic reports roll in.

By Steve Hargreaves, staff writer

NEW YORK ( -- After setting a new intraday high above $102 a barrel, oil prices turned lower Wednesday following a big rise in inventories and concerns over the nation's economic health.

U.S. light crude for April delivery fell 52 cents to $100.36 a barrel on the New York Mercantile Exchange. Oil had traded down 14 cents just prior to the report's release.

Crude set a new intraday high of $102.08 a barrel earlier in electronic trading. Analysts blamed the spike on investors pouring money into commodities as an inflation hedge against the weak dollar and seeking shelter from volatile stock markets.

But oil slipped after the Energy Information Administration's weekly inventory report. EIA said crude stocks rose by 3.2 million barrels last week, higher than the 2.4 million barrel increase expected by analysts, according to a Dow Jones poll.

Gasoline supplies, attracting more attention as traders anticipate the upcoming summer driving season, rose by 2.3 million barrels. Analysts were expecting a gain of 400,000 barrels. EIA said gas stocks are now above average for this time of year.

Distillates, used to make heating oil and diesel fuel, fell by 2.5 million barrels, slightly more than the 1.8 million barrel drop expected.

Oil hit a new trading high earlier in the session as a series of gloomy economic reports and comments from Fed Chairman Ben Bernanke sent the dollar to record lows against the euro. The euro traded at over $1.51 to the dollar early Wednesday.

In addition to investors flocking to commodities when the dollar falls, the falling greenback also sends oil prices higher as crude is priced in dollar worldwide. A lower dollar thus gives foreign consumers less incentive to conserve oil as crude is, relatively, cheaper for them. It also provides less incentive for oil-exporting countries to increase production, as they need a higher price per barrel to offset the lower dollar.

But one analyst said the falling dollar's effect on crude prices was already priced in by midday Wednesday, and traders began to fear the gloomy economic news behind the dollar's fall will hurt demand for crude.

"The energy market has two masters," said John Kilduff, an energy analyst at MF Global in New York, referring to both its attraction as an inflation hedge and the necessary strong economy to keep demand and prices high.

Kilduff said traders were eying not just the inventory build, but also a lackluster morning report on durable goods orders and a downbeat view on the economy from Bernanke.

"It's helping to feed into the feeling that the economic slowdown will be severe enough that energy demand will slacken," said Kilduff.

Bernanke, in testimony before U.S. lawmakers, said the economy still faces slower growth prospects.

Economic reports Tuesday helped sink the dollar and push oil to its fresh highs.

A survey on residential real estate revealed that the decline in home prices picked up at the end of 2007. And consumer confidence fell to its lowest level in five years, the New York-based Conference Board reported, on fears about the job market and slowing business activity.

But Bernanke also sounded the inflation alarm, and that could have helped send oil prices lower.

He said increasing inflation concerns could "complicate" the Federal Reserve's efforts to stimulate the economy, raising the possibility of a halt in interest rate cuts.

A halt in interest rate cuts could send the dollar higher, and oil prices lower.

Oil prices have nearly doubled over the last year, and has risen five-fold since 2002.

Most analysts say rising demand, especially from developing nations, coupled with few new discoveries of easily accessible oil fields is the main culprit behind the runup.

The tight supply and demand situation has also attracted a slew of investment money, and the falling dollar has played a role as well.

The fact that the world uses nearly as much oil as it produces has magnified the effect of geopolitical tensions, as there is less spare capacity to cover a supply disruption. To top of page

Merced man wins 2008 Dodge truck giveaway at World Ag Expo

First-time visitor to World Ag Expo, Steve Terry left the show not knowing that soon he would be the proud owner of a brand new 2008 Dodge truck. Terry’s name was drawn from thousands of entrees in the truck contest on Feb. 14 at the close of the 41st Expo.

Terry returned to Tulare today to claim his winnings from Lampe Dodge in Tulare, Calif. A first time visitor at World Ag Expo, Terry was completely shocked that he won the top giveaway at the show.

“We’ve never been to the Expo. My boss asked me if I wanted to go and I said sure. I couldn’t believe the phone message that said I won the truck. Just couldn’t believe it,” Terry said of his win.

Terry recently retired from Wonder Bread to work with a friend who needed help on his farming operation.

“I’ve never farmed in my life. I’m learning everything about almond and walnut farming from start to finish. World Ag Expo was an amazing place to visit for someone like me that’s just getting in the business,” Terry said.

It seems to be beginners luck for Terry, who has been welcomed to agriculture with a firm handshake and a brand new Dodge truck.

The 2009 World Ag Expo is Feb. 10-12, at the International Agri-Center in Tulare, Calif. For more information visit

Oil tumbles...I wonder why?


Oil prics extend their decline on stronger-than-expected crude and gasoline supplies. More soon.

Chrysler rethinks idea of selling many versions of the same car

Joseph B. White
By JOSEPH B. WHITE , Wall Street Journal Online

Long before scientists started cloning sheep and cows, Detroit was cloning cars. But now, it's not so clear that replication leads to addition when it comes to sales.

The idea that carmakers can make money selling consumers the same basic vehicle in different guises has been fundamental to the business since the days of Alfred P. Sloan, the architect of the modern General Motors Corp. Mr. Sloan perfected the idea of the brand ladder--Chevy at the bottom, Cadillac at the top and Pontiac, Oldsmobile and Buick in between. Over the years, those middle brands were increasingly stocked with cars that were basically fancier versions of the Chevrolet design.

More recently, just about every auto executive assigned to turnaround a car company has established building more vehicles from "common platforms" as a cornerstone of the strategy to regain profitability.

Implicit in this strategy is a belief that most consumers don't know and don't care whether a car branded as a Ford Fusion is fundamentally the same under the skin as the car sold as the Mercury Milan or the Lincoln MKZ. Instead, consumers are assumed to care only about superficial stuff--such as the exterior design, or whether a car has leather seats, or a specific branded audio system.

In the late 1970s, GM got sued by customers shocked to discover that their Oldsmobiles had Chevrolet engines under the hoods. Today the notion that there is such a thing as a "Buick" engine specifically for Buicks or a "Chevrolet" engine unique to Chevrolets is quaint. GM uses similar engines across its various brands--and its rivals do likewise.

Repackaging the same basic hardware to sell at different price points makes a lot of sense on paper. There are many examples of how it works just fine. Toyota, for instance, gets away with selling the basic guts of a V-6 Toyota Camry as both the Toyota Avalon and the Lexus ES 350. Ford seems to be having some success with the Fusion, Milan and MKZ--referred to in Dearborn as the "triplets."

But in a market with more than 300 different models--depending on how you count--fielding two or three or even four of the same basic car can lead to some very thin slices of pie, especially when increasingly well-informed shoppers can figure out in two or three mouse clicks that a Saturn Outlook and a Buick Enclave and a GMC Acadia are just three different styling takes on the same large crossover wagon.

In the case of those GM wagons, consumers have voted in favor of the Buick and GMC designs. The Enclave and Acadia, as of Jan. 31, had inventories of 41 days and 51 days, respectively. The average Enclave is off the dealer lot in just 15 days at an average transaction price of $38,479, according to data from the Power Information Network.

Meanwhile, however, GM is passing up potential Enclave and Acadia sales because the factory that builds those two vehicles has also spent time building Outlooks that sit unsold on dealer lots. As of Jan. 31, 10,690 Saturn Outlooks--138 days worth--were waiting for buyers. GM has offered 0% financing deals and other incentives to get Outlooks moving. When Outlooks do sell, they go out at an average transaction price of $32,824--nearly $6,000 less than the Buick Enclave. From December through Feb. 17, just over 19% of the Outlooks sold went out on loans with interest rates under 5%--reflecting a 0% promotion--compared to 6.3% of the Enclaves sold. (Average cash rebates for Enclaves and Outlooks were virtually the same, $921 and $922 respectively, according to Power Information Network data.) What will happen when GM rolls out a Chevy version of the same wagon--expanding the clone family to four--is anyone's guess.

Chrysler LLC has a similar problem with its trio of compact hatch-wagons, sold as the Dodge Caliber, Jeep Compass and Jeep Patriot. The Compass and Caliber sit unsold on dealer lots an average of 170 days and 116 days respectively, according to Power Information Network.

The Patriot, however, turns over in an average of 76 days. Not stellar, but better than the other two. Moreover, the Patriot, which looks like a miniature version of an old Cherokee, commands a higher average price than its two siblings.

The existence of three Chrysler compact cars appears to be more "production oriented than customer oriented," says Tom Libby, senior director of industry analysis with the Power Information Network. Chrysler bet that having three different variations on a basic car sold through two of its brands would give the factory that builds them a better shot at running profitably. Instead, Chrysler has two vehicles--the Compass and the Patriot--that are priced "on top of each other," Libby says.

Chrysler's senior management recently declared that it wants out of the clone game. The company, which has the advantage of being closely held and thus not as concerned about what outsiders think, has outlined plans to kill a flock of its slow-selling clones, and focus its efforts on selling more of each model that remains.

This might upset some Chrysler or Dodge dealers, who have relied on Chrysler to provide both Dodge and Chrysler and Jeep versions of their most popular vehicles, in order to support their sales volumes. Chrysler's reply, in effect, was, "too bad."

Customers don't care whether they buy a minivan from a Dodge dealer or the Chrysler dealer just down the street. They just want a good minivan. In these difficult times, Chrysler can't really afford the capital and marketing effort to promote two functionally similar versions of a three-row box on wheels.

Chrysler's break with the industry's clone theory won't happen overnight. But if it works, rivals might be tempted to cull their herds as well. In the meantime, sharp-eyed consumers who want to save a few bucks and aren't hung up about driving the hot seller or the hip brand, might do well to adopt one of the industry's red-headed step childre

This Day in Auto History:

Automobile Quarterly
Automobile Quarterly

E. R. Thomas married Flora Lozier, sister of Henry A. Lozier, a Toledo, OH bicycle manufacturer who would later produce the Lozier car
The Fruehauf Trailer Company is incorporated in Michigan
Electric automobile advocate Joseph John DiCerto is born in New York City
George W. Mason, President of the Nash-Kelvinator Corporation, is elected President of the Automobile Manufacturers Association to succeed Alvan Macauley, Chairman of the Packard Motor Car Company, who resigned after a 18-year tenure
Racer Dennis Setzer is born in Newton, NC

Source: Automobile History Day By Day, by Douglas A. Wick

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Hawaiin Dodge Neon SRT-4 733fwhp pull

One of our customer from Hawaii who is running our dual pump setup just made 733hp. Check out what happened to the inter cooler on a pull.

American Axle strike issues getting heated

Observers: Union seeks to affect car production


In what could be a sign of a prolonged strike against American Axle & Manufacturing, UAW negotiators from out of town were sent home Tuesday, and no talks were expected Tuesday night or scheduled for today.About 3,600 workers started picketing when the previous 4-year contract expired Monday night. Union members stayed out all Tuesday as snow fell, and union officials complained of unfair bargaining.

Industry observers and those involved in the strike say the union's key leverage is not so much in halting American Axle's output, but in disrupting production at its largest customer, General Motors Corp.

Whether GM starts to feel the strike against American Axle in a few days or a couple of weeks may dictate how long this strike could last, analysts said.

GM would not indicate how long it can withstand the supplier's strike, but an official said production was not affected Tuesday.

Detroit-based American Axle, which relies on GM for 80% of its sales, makes axles for GM's large truck and SUV lineup, which is under increasing competitive pressure. American Axle is a key supplier to at least 10 GM assembly plants.

"Logic would say that the customer has a voice in the room now," said Van Conway, founder of the Birmingham-based consulting firm Conway, MacKenzie & Dunleavy.

Production at Chrysler, American Axle's second largest customer, also continued, the automaker said.

Steep cuts upsetting

The UAW put most of its American Axle workers -- 3,600 people -- on strike early Tuesday morning, protesting the company's proposed reductions for wages and benefits.

Those proposals included cutting wages, which average about $27 an hour, by as much as $14, raising co-pays and terminating vision benefits.

The steepness of those proposed cuts brought hundreds of American Axle workers, bundled in Carhartt jackets, hoods and thick work gloves, to brave the wet, sticky snow that pounded American Axle's cluster of royal blue plants that straddle Detroit and Hamtramck.

UAW member Doug Elliott said he is prepared financially to withstand a two-week strike. To do that, he said he worked overtime shifts in recent weeks, which he guessed would be used to bank parts for American Axle's customers.

"It's a Catch-22," Elliott said. "Everybody at work knows that the company was building up stock to withstand a strike. ... I have got to do everything that I can do as a husband, as a father, to try to get my family through this."

Elliott, 49, of Warren said he picketed Tuesday so his family wouldn't have to sacrifice more in the long term if he were forced to take a wage cut.

Negotiators standing by

American Axle was ready to resume negotiations Tuesday, said company spokeswoman Renee Rogers.

Union negotiators are also on call, but they are demanding information that American Axle reportedly used as a basis for its concession demands, according to people familiar with the talks.

American Axle contends that it has not violated any labor laws.

"We have honored our duty to negotiate in good faith. ... We have provided the union with all the information they're entitled to receive," said Rogers, the spokeswoman.

The company has said repeatedly that it needs lower wages to compete with rival axle maker Dana Corp. and in-house axle operations at the automakers, which won second-tier wages and benefits in last year's UAW negotiations.

Workers say they already agreed to a two-tier wage for new hires, which was included in the last contract -- a contract that came after a day-long strike in 2004.

Despite a company-wide buyout program, American Axle says it doesn't have open positions at those lower rates and isn't saving money based on the prior contract.

But with the company making money and winning contracts, the union is in no mood to give steep concessions.

"Our members cannot be expected to make the extreme sacrifices American Axle is asking for with nothing in return," UAW President Ron Gettelfinger said in a statement.

Wall Street analysts said the demands by American Axle, whose stock trades under the ticker symbol AXL, were more than they had expected.

"These demands by AXL are well above the concessions we have been expecting out of the contract, leaving room for the company to back out of some requests and for the UAW to agree on large concessions," Lehman Brothers auto analyst Brian Johnson said in a note to investors Tuesday.

In a note to investors, KeyBanc analyst Brett Hoselton referenced a part of the company's proposal that included closing four plants, most likely two plants in New York, and a forging plant it has as part of the Detroit campus.

Such a move "is a very big deal and well outside the scope of what we expected," he wrote.

Johnson pointed out that the messages coming from the company and the union "may point to a wider disagreement between the two parties and to a more genuine type of strike than the ones observed at GM and Chrysler," last summer.

But Johnson said the strike should lead to significant savings for the company.

"We believe that a final agreement is likely to be reached within the next few days," Johnson wrote.

Plastech deal extended

Chrysler LLC, the third-largest U.S. automaker, said it reached an agreement to keep receiving parts from Plastech Engineered Products Inc. through March 3.The automaker's interim contract with the supplier under bankruptcy protection was set to end tonight. Auburn Hills-based Chrysler announced the extension Tuesday in an e-mailed statement.

The two companies have created two short-term agreements to continue supplying parts after Chrysler canceled contracts with Plastech on Feb. 1 and demanded the return of manufacturing equipment from the supplier. Plastech filed for bankruptcy protection and halted shipments to Chrysler, idling four of the automaker's factories.

US: Construction resumes on Getrag/Chrysler Indiana transmission plant

US: Construction resumes on Getrag/Chrysler Indiana transmission plant
By Megan Lampinen
27 February, 2008
Source: Automotive World
Chrysler LLC and transmission supplier Getrag have resumed construction on their new transmission plant in Indiana.

Chrysler LLC and transmission supplier Getrag have resumed construction on their new transmission plant in Indiana, according to Automo...

[Punishment of Robby Gordon]

NASCAR's punishment of Robby Gordon and team seems a bit harsh, given the circumstances. Dodge provided him with a nose that hadn't been approved. He just switched to Dodge. We understand why he couldn't tell the difference. No one could tell a difference without measuring instruments.

Dodge called its generic car an Avenger last year. This year it's a Charger. Same car. Oh, wait. Dodge submitted a "Charger" nose for approval. NASCAR hasn't approved it yet. Given that logic, doesn't that make the Dodge an Avenger still?

Fines are being awarded to the NASCAR Foundation this year. Does that make Robby Gordon's $100,000 fine a charitable donation?

Roger Penske's Daytona 500 victory was bigger than Ryan Newman's. Dating back to the early 1970s, the most distinguished owner in the history of American motorsports had never won the 500.

The break-up of open-wheel racing played a significant role in NASCAR's increase in popularity. Now that the IRL and ChampCar have gotten back together, will that coincide with the IndyCars regaining some popularity?

Originally, Auto Club Speedway (i.e., California) scheduled Craftsman Truck and Nationwide series races on the same day, Saturday. When rain washed out the Nationwide race, officials moved it to Sunday, meaning that it was rescheduled for after the Sprint Cup race.

Jacques Villeneuve's great NASCAR experiment may be over practically before it started. The one-time World Driving Champion failed to make the Daytona 500 starting field and then was replaced by Mike Skinner. Apparently Villeneuve couldn't close the deal on a sponsor.

Tuesday, February 26, 2008

All Because of Greed - Energy Speculation and the Lies

The same oil price increases that make Arab rulers wealthy also are rapidly pushing the Middle East’s middle class toward poverty.

Strikes, demonstrations and riots from Morocco to the Persian Gulf are becoming commonplace as inflation causes prices for basic foods and other necessities to skyrocket.

In Jordan, the cost of some fuels shot up 76 percent overnight after the government had to remove almost all fuel subsidies.

Rising fuel had immediately doubled prices of food staples like eggs, potatoes and cucumbers.

The region’s strong reliance on food imports makes the Middle East especially susceptible to global commodity price increases, a condition made far worse by monopolies and corruption.

Two-thirds of Jordanians reportedly believe there is widespread corruption in the public and private sector, says Mohammed al-Masri, public opinion director for the University of Jordan’s Center for Strategic Studies.

"The middle class is less and less able to afford what they used to, and more and more suspicious,” al-Masri told The New York Times.

"For many basic products, we don’t have free market prices, we have monopoly prices,” notes Jordan’s former minister of national economy Samer Tawil.

"Oil, cement, rice, meat, sugar: these are all imported almost exclusively by one importer each here,” he said.

Governments in oil-rich countries have acted to increase wages and food subsidies for public sector employees.

Yet those who work in the private sector don’t benefit, and many analysts say that higher government spending is making regional inflation worse.

"Now we have to choose: We either eat or stay warm,” Jordanian retail worker Abdul Rahman Abdul Raheem observes. "We’re not really middle class anymore; we’re at the poverty level.”

The Jordanian 2007 inflation rate was officially reported as 5.4 percent, but government studies show middle-income families are spending far more on food while consuming less of it.

Even with subsidies that make buying necessities still in place, inflationary pressures of the past few months have taken a toll on all but the rich in Syria, where oil production is severely diminished.

"Many people believe that most of the government’s economic policies are adopted to suit the interests of the newly emerging Syrian aristocracy, while disregarding the interests of the poor and lower middle class,” says Damascus University political science professor Marwan al-Kabalan.

In Saudi Arabia — where inflation has been virtually non-existent for the past decade — public outcry over the current official 6.5 inflation rate has been huge, with the sharp contrast between new oil wealth and skyrocketing prices leading 19 prominent Saudi clerics to publicly warn against "theft, cheating, armed robbery and resentment between rich and poor.”

People living in Bahrain and the United Arab Emirates are experiencing double-digit inflation, causing the foreign-born workers who make up most of the area’s workforce to strike in recent months.

The purchasing power of the money they send home in currencies is pegged to the U.S. dollar and thus declining.

Protests over the cost of bread culminated in violence in Yemen, where at least a dozen protesters were killed; a confrontation between Lebanese Army soldiers and Shiite protesters triggered by rising bread prices killed seven more.

Thirty-four Moroccans are in prison for taking part in riots over food prices and even tightly controlled Jordan has seen nonviolent demonstrations and strikes.

It will likely only get worse.

The U.S. Department of Agriculture reports that record prices are forecast again in 2008-09 for wheat, corn, and soybeans, boosting expected producer returns to the highest level since the mid-1980s.

1546 HP Twin Turbo Dodge Viper GTS Dyno Run

1546 HP Twin Turbo Dodge Viper GTS Dyno Run

This has to be the loudest UPS truck we've ever heard. It's really important to notice during this dyno run how the hand held camera is shaking during one of the pulls. So it may not be quite as insane as the 2,200 hp quad turbocharged V8 we saw on Friday, but it's definitely more streetable, and has up to 100% more Dodge Viper GTS. This sucker is obviously set up for drag racing though following the advice of the video and going to gets us no additional info on the car. We did dig up pictures of the beast though, and its pretty sick. This almost makes us sad that the Viper is as good as dead these days. How much you want to bet these guys have already rented an oversea container to Poland?

1546hp Viper GTS

This Day in Auto History:

Automobile Quarterly
Automobile Quarterly

Lee Sherman Chadwick, designer of the 1904-1916 Chadwick, is born in East Braintree, VT
Joseph Athanasius Anderson of General Motors is born in Ishpeming, MI
Joseph Elkan Adams of the White Motor Company is born in Cleveland, OH
Forrest Kenneth Poling of the Ford Motor Company is born in Dixon, OH
Racer Francois Mazet is born in Paris, France

Source: Automobile History Day By Day, by Douglas A. Wick

Souped-up Charger takes sting out of Viper

DAVID GRAINGER, Canwest News Service

Published: 6 hours ago

The Dodge colour Plum Crazy has a very special significance for me. When I was a kid in the 1960s, my mother saw a Dodge sporting that colour when it first premiered.

She had just bought a '65 Chevy Impala in need of paint, so she decided to paint her car that shade. It ended up looking spectacular as the car had a turquoise interior. It also became a problem as the colour drew a lot of attention to her.

In less than a year and much to our mutual sadness, she had the car repainted a metallic brown, which drew very little attention.

Plum Crazy, especially in the age of any colour you want as long as it is silver, still demands attention. I recently spent a week in a limited-edition Plum Crazy Dodge Charger Daytona R/T and I had a really surprising amount of positive comments, even from the people at drive-throughs.

The Charger design in any colour is striking. While the interior is Spartan in some regards, it is also tasteful, culminating in a really pleasant vehicle to be in as well as be seen in.

I know that a lot of people have been down on the Charger because it is a four-door, but clever design with the roofline and rear post allows the rear doors to almost disappear. That leaves one with the convenience of a four-door and the looks of a coupe.

Handling and power are quite good, especially for a car this large. Fuel economy is surprising, especially in light of gas prices. If driven conservatively, fuel consumption is bearable. The Charger is as roomy and a touch more comfortable inside than most SUVs and the trunk is immense, so the argument for load carrying that proponents of city-driven SUVs often make is really rather moot.

I could easily see myself driving a Charger R/T as an everyday vehicle until I was offered and accepted a test in the Charger SRT8.

The SRT8 is evil. At 425 horsepower, it is as powerful as the first-generation Viper. The truth is, it probably handles better, even with the traction control off.

The fuel economy, if you care, is a lot better than any Viper's. And, unlike a Viper, you can take four friends with you. I did find that I spent a lot of my driving time with the traction control off simply because I was on a lot of slippery, icy roads and I like to have a feel for what is under me.

The traction control - even the tweaked system that's used in the SRT8 - has a bit of a tough time deciding what to do on glare ice so it opts for going slow. Perhaps it's not a bad thing, especially if you are not a drifting champion.

In my first 10 minutes of driving, I was already in trouble. I was accelerating on the ramp to a highway and looked down to see that I was rapidly approaching the 50-kilometres-over-stupidity mark. As I would have then been considered racing and performing a stunt, I backed off immediately.

Stealth is great, but if you can't use the car even close to its potential on roads, you should at least be able to show off the fact that your car, four doors and all, can give most Porsches a run for their money.

The SRT8 was black, which was attractive. But I have an even better idea.

The SRT8 would be irresistible if it were painted Plum Crazy or the other equally flamboyant special-edition colour, Sublime, a brilliant lime green.

I would be pulling on the bell bottoms right now if that were the case.

National Post

SUV safety improves, but soft spots remain

The 2009 Nissan Murano won IIHS' "Top Safety Pick" award
Top family rides
A closer look at some of Kelley Blue Book's picks for the best new family vehicles.
Detroit concept cars
Check out some of the concept cars on display at the Detroit Auto Show.

Highway safety group says Hummer H3, Jeep are less than stellar. Names Nissan Murano as a top safety pick.

By Ben Rooney, staff writer

NEW YORK ( -- Midsize SUVs are becoming safer, but side and rear impact crashes remain a weakness, according to recent testing by the Insurance Institute for Highway Safety.

The IIHS conducts crash tests in three main areas: font, side and rear. Of the ten vehicles tested, nearly all received the top rating of "good" in the frontal crash protection test.

The one exception was General Motors' (GM, Fortune 500) Hummer H3, which earned an "acceptable" rating in the front evaluation, one step below "good" on the scale. The 2008 H3 also received an "acceptable" rating in the side evaluation and a "poor" rating, which is the lowest possible score, in the rear crash protection test.

Nick Richards, a Hummer spokesman, pointed out that the H3 meets or exceeds all federal crash safety standards. "The Insurance Institute tests represent one measurement of crash performance," he said in a statement.

In the side test, the Jeep Liberty, Jeep Wrangler, Dodge Nitro and Kia (KIMTF) Sorento, all 2008 models, were the worst performers. The Liberty, Wrangler and Nitro all received the second-lowest rating "marginal," while the Sorento had the lowest rating of "poor."

Joe Nolan, the Insurance Institute's senior vice president, said in the report that the side impact evaluation revealed some "surprising" results.

"SUVs should have an inherent advantage in such [side] crashes because drivers and passengers ride higher up than in cars. People often think they're safer in an SUV, but many cars perform much better in our side test than some of the SUVs in this group."

The IIHS report noted that the Jeep Wrangler was tested without its optional combination head and torso side airbags. Manufacturers may request a second test with the airbag option at their own expense. But Chrysler, which makes the Wrangler, did not request another test, according to the report.

"We assume that Chrysler doesn't expect the Wrangler to perform much better, even with the optional airbags," Nolan said in the report.

Max Gates, a Chrysler spokesman, said in a statement that the IIHS report contains "unsupported speculation" about the company's reasons for not paying to conduct a second side impact test for the Wrangler.

"In fact, our internal testing indicates there is additional protection provided by side air bags," he said.

The 2009 Nissan (NSANY) Murano received top ratings in all three categories and was named a Top Safety Pick by the Insurance Institute. That means it earned the best possible ratings for front, side and rear impact protection, and it's available with electronic stability control.

Overall SUV safety has been improving over the last few years as manufacturers add safety features like ESC and side airbags, according to the Insurance Institute.

In 2001, only half of the midsize SUVs tested by the IIHS earned "good" ratings in the frontal offset tests. In the latest round of testing, only one vehicle was rated below "good."

"Increasingly, consumers are getting the latest safety equipment without having to hunt through a list of options," Nolan said. To top of page

UAW local strikes American Axle

Talks break down over proposed concessions


The UAW sent most of its members at American Axle & Manufacturing Inc. on strike early today, protesting the company's proposals on wage and benefit concessions.

People filtered out of the union hall for UAW Local 235, on Holbrook Street in Hamtramck, with picket signs. Some were moving toward the nearby American Axle complex.

“The UAW has a proven record of working with companies to improve their competitive position and secure jobs,” said UAW President Ron Gettelfinger in a statement. “But cooperation does not mean capitulation. Our members cannot be expected to make the extreme sacrifices American Axle is asking for with nothing in return.”

The strike affects about 3,600 workers in American Axle plants in Michigan and New York. The UAW represents about 1,000 more workers under different contracts at the company.

In a letter to members handed out at meetings Monday night, the union said the company had made unreasonable proposals on wages and proposed increasing co-pays for prescription drugs, eliminating vision coverage and freezing pension benefits, replacing them with a 401(k) plan.

The union said it requested information from the company on the assumptions used to reach these demands, but the supplier has so far refused. The union is now accusing American Axle of committing unfair labor practices.

"We will have no alternative but to strike," the letter said. American Axle's contract expired at 11:59 p.m. Monday.

In a statement, the UAW said the company demanded wage reductions of up to $14 an hour.

In its own statement, the company said its primary objective "is to achieve a market-competitive labor cost structure in the United States," similar to agreements other companies had reached with the UAW.

Without such changes, the company said, its ability to compete for future business or retain existing business at these locations is in immediate jeopardy.

This is the third strike against an auto company in six months and the second strike against Detroit-based American Axle in four years.

Earlier Monday evening, the two sides were still far apart on the fundamental issue of wages, which the company has been seeking to lower for more than 3,000 workers, said people familiar with the negotiations.

Another sticking point in the talks was the company's proposal for plant shutdowns, said Wendy Thompson, former president of UAW Local 235, who had been briefed on the talks.

Management has said it wants to lower the overall compensation from $65 an hour, including wages and benefits, to $27.

That would take wages from about $27 an hour to more like $14 to $18 an hour -- a level closer to what Delphi Corp. pays, or the second-tier wage negotiated at the Detroit Three last summer.

"We continue to believe the new contract has the potential to take down AXL's labor cost by $20 an hour and, with attrition programs, yield potential savings of $200 million annually," said Lehman Brothers auto analyst Brian Johnson.

Monday, February 25, 2008

2008 Dodge Rams spotted in Sydney!

February 26, 2008 ·

Just this morning. I almost drove into a wall! Two brand new Rams on a car-carrier driving up Mt Ousley. Call me a hillbilly if you must but this is big news. The Ram with the Cummins turbo-diesel is one of very few cars to spike my interest these days. I did some snooping around online this morning, and as far as I can tell, this is the first “official sighting” of new Rams in the wild in Oz.
I can’t wait for my father-in law to find out..

UAW talks with American Axle as strike deadline looms

DETROIT -- A strike deadline at American Axle & Manufacturing Holdings Inc. looms late tonight as marathon UAW negotiations continued through the day.
The supplier has prepared for a strike by stockpiling axles and other parts mainly for key customer General Motors. A strike would idle about 3,600 UAW-represented workers at five U.S. plants. American Axle wants concessions that would halve current hourly wages and benefits from $60 an hour. Spokeswoman Renee Rogers said talks are continuing but declined further comment.
A UAW official said he expected the parties to extend the contract so that a strike could be at least temporarily avoided. The official asked not to be named.
The Detroit driveline maker is looking for concessions similar to those provided by the UAW to the

Passages: Douglas Fraser, 1916-2008

Turning of a page in United Auto Workers History as visionary leader Douglas Fraser, UAW president during the troubled years of 1977-'83, passes away at age 91. (Photo courtesy of Wayne State University)

DETROIT — Ron Gettelfinger has presided over the United Auto Workers during one of the most painful chapters in the union's history. But without the contributions and leadership of Doug Fraser, particularly during the turbulent '70s and '80s, there might not be a UAW today.

Fraser, who was president of the UAW from 1977-'83, died Sunday at age 91. One of the most powerful and popular labor leaders in the country, he helped Chrysler win support for a government bailout in 1979 when the cash-poor automaker was near bankruptcy; later, the Scotland-born Fraser sat on the company's board of directors.

After decades of winning increasing perks and power from the auto companies, including better working conditions, improved pensions and comprehensive health care, Fraser presided over the UAW during a difficult economic period that saw the union surrender some of those hard-fought gains in an effort to help keep the Detroit manufacturers afloat.

Since his retirement from the UAW, Fraser — a high-school dropout — had served as a professor of labor studies at Detroit's Wayne State University.

What this means to you: In the 25 years since Fraser's retirement from the UAW, the union has seen its rank and file dwindle and member benefits be slashed. But the fact that there is still a union — and a U.S. auto industry — is due in no small part to Doug Fraser's vision and his diplomatic and negotiating skills. — Paul Lienert, Correspondent

Chrysler's Geneva line up

AUTOCAR - The Geneva motor show sees the world launch of Chrysler’s new 'SRT Design Group'; a styling package that has already been seen on the 300C diesel.

The next model to receive the SRT Design treatment is the Grand Cherokee V6 CRD. The 3.0 diesel Jeep will take styling cues from the range-topping V8 SRT-8 model, though no changes will be made to the car's mechanicals so customers get the same 215bhp, 376lb ft of torque and 27.7mpg from a 3.0-litre diesel V6.

Tweaks include new 18-inch Arrowhead alloy wheels, a rear spoiler and front air dam. It also loses the standard car’s roof rack to smoothen the profile and gains the same grille as the SRT-8. Prices are yet to be announced.

Dodge is also using the Geneva show to reveal the new Caliber SRT-4, the latest addition to the full-on SRT performance range.

The Caliber has been a huge success outside of America, outselling all other Chrysler, Jeep and Dodge products, and a high performance model should continue this trend. However, there are no plans for right hand drive production – so no official UK sales.

The SRT4 uses Chrysler's 2.4-litre engine stretched to produce 285bhp, and 265lb ft of torque – all driven through the front wheels. Expect a sub seven second 0-60 time, and Dodge claims that it will offer a superior power-per-Euro rating than its rivals, though no official prices have been revealed.

The Chrysler brand’s Geneva display will also see the European debut of the electric ecoVoyager concept, as well as the new Grand Voyager.

EMC Receives Chrysler LLC Supplier Pentastar Award

HOPKINTON, Mass., Feb. 25 /PRNewswire/ -- EMC Corporation, the world leader in information infrastructure solutions, today announced that automotive giant Chrysler LLC has recognized EMC with the 2007 Chrysler Supplier Pentastar Award in the General Goods and Services category.

"Our suppliers play a critical role in Chrysler's ability to meet our customers' demands for vehicles with outstanding quality and innovative technology," said Chrysler Executive Vice President - Procurement John Campi. "We are proud to recognize their outstanding performance and continued contribution to our success."

The recipients of the 2007 Chrysler Supplier Pentastar Awards were selected based in part upon the unanimous decision of senior members of the Chrysler Procurement, Supplier Quality and Supply organizations, and the supplier's performance as measured by Chrysler's External Balance Scorecard -- a fact-based system that measures the critical value drivers of quality, technology, cost and delivery -- factors the company uses to determine sourcing strategies.

"We are honored to be among Chrysler's top-performing suppliers," said Frank Hauck, EMC's Executive Vice President, Customer Operations. "For more than 10 years, we have strived to provide Chrysler with high-value, low-risk information infrastructure solutions to maximize the value of their information assets, improve IT service levels and lower costs. We look forward to being a part of their continued success."

EMC was presented with the award during the company's Supplier Pentastar Awards ceremony at the 2008 North American International Auto Show in Detroit, Mich. The ceremony, which recognizes Chrysler and its suppliers' shared vision for collaboration and innovation, is the first for the automaker since becoming a private concern in 2007.

Test Drive: 2008 Dodge Grand Caravan Canada "Value Package"

2008 Dodge Grand Caravan CVP
2008 Dodge Grand Caravan CVP. Click image to enlarge
2008 Chevrolet Uplander
2008 Honda Odyssey
2008 Hyundai Entourage
2008 Kia Sedona
2008 Nissan Quest
2008 Pontiac Montana SV6
2008 Toyota Sienna

Manufacturer's web site
Chrysler Canada
Review and photos by Jil McIntosh

Photo Gallery:
2008 Dodge Grand Caravan

Oshawa, Ontario - For 2008, Chrysler completely redesigned its venerable stable of minivans, the Dodge Grand Caravan and its upscale Chrysler Town & Country sibling. I was along for the launch of those, and the first thing I noticed was that every model sported a long wheelbase.

The company officials on hand seemed a little unsure if dropping the short-wheelbase model was really a good idea, especially since that version accounted for half of all sales in Canada. The official report was that customers bought the "shortie" mainly for its price, not its length, and that the new long-wheelbase model would attract buyers with an extensive list of features at value pricing. (Now that it's available, the new Dodge Journey is poised to fill the size gap, although it's more crossover than minivan.)

At $26,495, the base 2008 model is still priced above the last-generation short-wheelbase's official price of $25,555 (and even more if you account for sell-off prices, which went as low as $17,495), but it's still a reasonable amount, considering its features and roomier interior. That puts its tag below the $30,995 Hyundai Entourage and $29,745 Kia Sedona, and the extended-length versions of the Chevrolet Uplander at $27,620 and Pontiac Montana SV6 at $27,930. The short-wheelbase models of those two, the only full-size shorties left in the market, come in below the Grand Caravan at $24,390 and $25,060, respectively. The Canada Value's price is also $2,300 under the Grand Caravan SE Stow 'n Go model, and $4,000 under the top-line SXT trim line. Since many buyers in this segment base their purchases primarily on price, it's ideal for those who want a roomy and well-equipped van but are willing to forego some of the bells and whistles.

That base price gets you the Canada Value Package, an (obviously) Canuck-specific version that trims some items off the SE model. Most obvious is the standard two-passenger second-row bench seat: the disappearing Stow 'n Go and the spinning Swivel 'n Go seats cannot be added to this base model. If you want a flat cargo floor, it's got to be done the old-fashioned way by unlatching the heavy seat and rolling it out. As with the other models though, the 60/40 third-row seats fold easily into the rear, and the floor directly behind the front seats contains the large covered bins that would normally hold the folded Stow 'n Go seats. Here, they can be used to add a considerable amount of hidden storage.

In its favour, the second-row bench is also more comfortable than the Stow 'n Go seats, which have thinner foam so they'll fold up, and which can get plenty hard on a long trip. As with the other models, the third-row seats can also be flipped backwards, "stadium-style", and their backrests used as cushions for al fresco seating.

Like the SE, the Canada Value uses the base 3.3-litre V6 engine with four-speed automatic. Overall, it's a good fit, although it can get huffy on steeper inclines, especially if you've got a full load; for most buyers who need it as commuter transportation, it will be fine. There's a touch of torque-steer, but overall, the steering is nicely weighted and the van is easy to manoeuvre, with a fairly tight turning radius. The official figures are 12.6 L/100 km on the city and 8.4 L/100 km on the highway; my combined fuel use, in cold weather, was 13.9 L/100 km.

The interior is a vast improvement over the last-generation Grand Caravan; it still could be somewhat better, but it's far more forgivable in the inexpensive model than it is in the pricey Town & Country. The gearshift lever now moves to the instrument panel, while centre stack controls thankfully remain large, simple and easy to use. The Canada Value doesn't have a centre console, but I didn't mind, since it gave me plenty of space to park my briefcase between the front seats. There are numerous storage spaces throughout the van, including a massive double glovebox, and grocery bag hooks on the rear of the front seats.

Although this base model doesn't have all the creature comforts, it still contains numerous items that are standard on all Grand Caravans, including air conditioning, curtain airbags, anti-lock brakes, electronic stability control, power locks with keyless entry, tire pressure monitoring system, CD stereo and power windows, including a one-touch-down feature on the driver's door.

Available extra-cost options on the Canada Value include cruise control, YES Essentials stain-resistant fabric, eight-way power driver's seat, a stereo upgrade including satellite radio, and integrated child seats in the second-row bench.

The base package doesn't come with power mirrors, which it really needs; heated ones can be added as a stand-alone feature for $150. Unavailable options are mostly limited to entertainment: this trim line also can't be outfitted with MyGIG hard-drive music system, a backup camera or a second-row DVD player.

Still, even without those, the Canada Value is a sturdy and very comfortable choice, and well-geared toward those who never need to fold seats into the floor, or screen films for rear-seat passengers. I remember when a base van had one sliding door, three rows of hard seats and a steering wheel, and that was about it. Roomy and relatively inexpensive, this is a value-packed vehicle for those who don't need to check off every option on their daily transportation

Pricing: 2008 Dodge Grand Caravan Canada Value Package
Base price: $26,495
Options: $125 (Easy-clean floor mats)
A/C tax: $100
Freight: $1,350
Price as tested: $28,070

2010 Dodge Ram SRT8 Chop

This Day in Auto History:

Automobile Quarterly
Automobile Quarterly

The first motor vehicle accidental death in Great Britain occurs in London
Henry Russel of Oldsmobile dies at age 67
Racer Jurgen Lassig is born in Tuttlingen, Germany
Sir William M. Letts, pioneer British automobile designer and founder of the Automobile Association, dies in Llandudno, Wales one day short of his 84th birthday
Maurice Farman, pioneer racer, luxury automobile manufacturer, and airplane designer, dies in Paris, France at age 86

Source: Automobile History Day By Day, by Douglas A. Wick