Thursday, August 31, 2006

General Motors files multibillion-dollar claim against Delphi

General Motors files multibillion-dollar claim against Delphi
By Joseph Rebello
Last Update: 6:33 PM ET Aug 7, 2006

WASHINGTON -- Delphi Corp. said General Motors Corp. made a "multibillion-dollar" demand for payment against the struggling auto-parts company, which has been relying on GM's help to carry out its bankruptcy reorganization.

In papers filed with the U.S. Bankruptcy Court in Manhattan on Friday, Delphi said GM made the demand July 31 in a proof of claim filed against Delphi and its subsidiaries. Such filings are made by creditors of companies in bankruptcy proceedings. They constitute a formal demand for payment, although the claim is seldom paid in full.

Delphi, a former GM subsidiary that is also GM's biggest supplier, has said it has its own demands for payment to make against GM. Its creditors have estimated GM's debt to Delphi in the "billions of dollars" and have complained that Delphi has been slow in demanding payment from the world's biggest auto manufacturer.

Delphi, however, said now isn't the time to pick a fight with GM because a quarrel could jeopardize its reorganization effort. "GM's participation in Delphi's labor transformation is a strategic element of the reorganization," Delphi said in the papers filed Friday.

The company asked U.S. Bankruptcy Judge Robert Drain, who is overseeing Delphi's Chapter 11 reorganization, not to grant its creditors committee the right to sue GM on Delphi's behalf. Delphi said its board of directors intends to assert "some or all" of the company's demands against GM before an October 2007 deadline.

Drain is scheduled to consider the matter at an Aug. 17 court hearing.

Delphi is the largest of the U.S. auto-parts companies that have tumbled into bankruptcy proceedings over the last year. It filed for Chapter 11 protection last October, listing $22 billion in debt. Since then, the company has been negotiating both with GM and its labor unions to find ways to cut costs.

During a troubled phase of those negotiations in March, Delphi blamed GM for many of its financial difficulties. Referring to the company's origins as a GM subsidiary, Delphi said that "as a result of the manner in which Delphi was created...the debtors' products do not represent a strategic vision." Those circumstances, it said, caused Delphi to lose billions of dollars after the company was spun off from GM in 1999.

Delphi's cost-cutting efforts have since progressed considerably. With financial assistance from GM, it persuaded thousands workers to accept early-retirement incentives. The company has said those buyouts have created "a more favorable environment" for an agreement with its unions on cuts in wages and benefits. It expects to exit Chapter 11 proceedings by the middle of 2007.

Delphi has said GM agreed to bear half the cost of the labor-reduction programs it initiated this year - in return for the right to file a general unsecured claim against the company.

Delphi hasn't yet specified those costs, but GM has in court papers said the claim it agreed to file against Delphi is "substantially less" than it was entitled to. It said it settled for a "general unsecured claim" that obligates the company to wait in line with all other unsecured creditors seeking repayment from Delphi. Such creditors typically recover a fraction of their claims.

Renae Rashid-Merem, a GM spokeswoman in Detroit, said GM filed its claim against Delphi "along with all other creditors" who had to meet a July 31 filing deadline. She declined to provide details of the claim, saying that information isn't public. GM's claims, she said, were "primarily" general unsecured claims.

(Terry Kosdrosky in Detroit also contributed to this article.)

Renee Rashid-Merem, a General Motors Corp. spokeswoman in Detroit, said GM filed its claim against Delphi "along with all other creditors" who had to meet a July 31 filing deadline.

(In an item published at 4:29 p.m. EDT, Rashid-Merem's first name was misspelled.)
-Contact: 201-938-5400

Copyright © 2006 MarketWatch, Inc. All rights reserved.

GM announces customer cash incentives on 2006 and 2007 models

Tuesday, August 29, 2006
GM announces customer cash incentives on 2006 and 2007 models
Associated Press

DETROIT -- General Motors Corp. announced Tuesday that it will offer $500 to $1,500 in bonus cash on many of its 2006 and 2007 models.

The offer is good until Sept. 5, and in most cases, comes in addition to previously announced low-interest loan and customer cash offers.

The cash offer does not apply to GM's-hotter selling models, including the Pontiac Solstice; Saturn Sky, Aura and VUE Green Line; Chevrolet Corvette; the 2007 GMC Yukon/Yukon XL Denali; Hummer H1; and 2007 Cadillac Escalade.

The company is offering $500 in bonus cash on many of its cars, $1,000 on many of its pickups and car-based sport utility vehicles, and $1,500 on some of its truck-based SUVs.

Company spokesman John McDonald said the incentives are merely the company's annual Labor Day sale and not a sign that it is backing away from its strategy of trying to bring sale prices closer to the sticker prices.

© Copyright 2006 The Detroit News. All rights reserved.

Tuesday, August 29, 2006

First Chevrolet S-10 part of GM celebration at Moraine plant

First Chevrolet S-10 part of GM celebration at Moraine plant
It has been a quarter of a century since the automaker began producing road vehicles in the Dayton area.
By John Nolan
Staff Writer

MORAINE Displayed for visitors near several eye-catching cars from the early 20th century, the orange-red Chevrolet S-10 pickup truck housed in a Carillon Historical Park building appears rather plain, if not homely.

But it has noteworthy status in the region's history. It was the first vehicle produced in 1981 at the General Motors assembly plant in Moraine, and thus became the first road vehicle assembled in the Dayton area since the Maxwell Motor Co. closed in the 1920s.

This week, the Chevy S-10 will make a brief return to the place of its manufacture as GM borrows it to begin a year-long celebration of 25 years of building cars or trucks in Moraine.

The pickup was the first one off the production line at Moraine on Aug. 26, 1981. It was a 1982 model, part of Chevrolet's introduction of a line of compact pickups meant to compete with imports from Japan.

GM had just spent $1.2 billion to convert its former Frigidaire refrigerator plant in Moraine to a truck-building plant, re-employing hundreds who had lost their jobs when GM sold the Frigidaire division in 1979 and it was closed.

An executive of a contractor that had overseen the rebuilding of the plant for auto production bought that first Chevy S-10, then donated it for display.

The truck's base price in 1981: $6,269, for the simplest model that featured a four-cylinder engine and four-speed, manual transmission. (That would be $14,034 in 2006 dollars.)

Dayton History, the private nonprofit that runs the Carillon Park buildings, has agreed to lend the Chevy briefly this week to GM Moraine. The truck is to be picked up Thursday, then returned Friday afternoon after it serves as a centerpiece for an internal ceremony involving GM Moraine's shift workers and management. They will serve cake, watch a video highlighting the past years of automaking history, and view a display of some of Moraine's current sport utility vehicles, including the Chevrolet TrailBlazer, GMC Envoy and Buick Rainier.

The Moraine employees are discussing plans for other events next year to mark the 25th anniversary. Still in planning phases, but they could include a parade or festival, a community celebration next summer and even an event to which the public could bring classic cars for display, plant spokeswoman Jessica Peck said.

GM also has developed a logo for the anniversary celebration. The logo includes a reference to the plant's presence of more than 55 years in the Miami Valley, which incorporates its Frigidaire era.

Contact this reporter at (937) 225-2242 or

Copyright ©2006 Cox Ohio Publishing, Dayton, Ohio, USA. All rights reserved.

Saturday, August 26, 2006

GM's Big E85 Push

GM's Big E85 Push
GM's vice-president of environment and energy, Beth Lowery, on the part ethanol-fueled vehicles will play in the company’s turnaround

There's no doubt about it. Ethanol's promise has a healthy, golden glow—and it's not just from the corn. Proponents insist that renewable E85 fuel could significantly ease addiction to foreign oil and reduce tailpipe emissions. All based—even better yet—on homegrown-in-the-heartland American corn crops. But, opponents say the consortium of producers and vehicle manufacturers pushing the fuel are simply wearing rose-tinted glasses.

The debate over the viability of E85 fuel—a blend of 85% renewable ethanol and 15% gasoline—has heated up since the beginning of the year, when President Bush gave it banner treatment in his State of the Union address. Since then, all of the Big Three have committed to doubling production by 2010 of flex-fuel vehicles, cars, and trucks that can run on either E85 or regular gas.

Beyond its potential to curb dependence on foreign oil, pro-E85 camps cite the fuel's higher octane rating, lower greenhouse emissions, and simpler infrastructure investments compared to potential fuels of the future like hydrogen. Ethanol production can also take advantage of otherwise unused American-grown crops.

But critics say the fuel is less efficient than gasoline and could not survive—either in production or at the pump—without lucrative government subsidies. Of even more immediate concern, they point to the extremely limited availability, with only around 900 stations selling the fuel nationwide—even if that number is continually growing. (For more on ethanol, (see, "Special Report: Ethanol".)

Nevertheless, it appears consumers are receptive to considering the fuel's potential. A Harris Interactive study, the results of which were released last month, shows that two-thirds of adult vehicle owners are familiar with flex-fuel vehicles and more than half are interested in purchasing one. Of those consumers, 88% cited "reduced dependency on petroleum" as the major cause for consideration. And, more surprisingly yet, 53% said they were willing to pay more for such a vehicle.

General Motors' efforts may have something to do with changing attitudes. The company launched a national campaign promoting country-wide use of E85 this spring. The campaign, dubbed Live Green, Go Yellow—playing on both the environmental benefits and ethanol's relationship with corn—features flex-fuel GM cars from the 2006 and 2007 model years.'s Matt Vella spoke with Beth Lowery, GM's vice president of environment and energy, about the company's big E85 push, challenges past and present, as well as the road forward. Edited excerpts follow.

What part does a campaign like Live Green, Go Yellow play in the overall plan to bring GM back into financial health?

As part of the overall turnaround, we were asking: How can we improve GM's image? How can we educate people about renewable fuels? What can we do when the price of fuel goes up? And, how can we give our customers a choice? Obviously, the timing for such a campaign could not have been better. Live Green, Go Yellow is particularly important from a marketing standpoint because it reaches the customer directly.

Your background is in law, not engineering or marketing. What kind of message do you think it sends to have someone like you heading up environment and energy, rather than someone who came up evangelizing or developing products?

What I do is ask: How do I synthesize R&D efforts, make consumers and opinion-makers care, and who are the people in Washington and the states that put the right policies in place? Live Green, Go Yellow is a very good example of where we've acted all together, with policy working with marketing working with engineering. We've got the products and, at the same time, we've got the campaign. It is an excellent example of the power of when GM comes together and acts as one company.

Is that kind of broad-based, cohesive action unique at GM? How much force or effort goes into getting everyone to get together?

I don't think it's unique so much as it demonstrates how powerful it can be. When you have everybody consistently working on the same messages, it hits federal and state [levels], consumers, energy companies get interested, local retailers get interested, we even have inventors calling us. We really have put ethanol on the map. It is a matter of collective will.

Why E85 and not another alternative fuel technology?

It's here and now. We have more than 2 million flex-fuel vehicles on the road today. One of the things we learned over the past year is that people were interested in what GM was doing from a technology standpoint, but when we talked about hydrogen and fuel cells, they thought that was too much in the distance. The program needed some catalyst for people to understand concretely. With biofuels and renewable fuels, people see they can really do their part now.

Another thing GM is very focused on is, if this is going to make any difference at all, it has to be something that the customer is willing to pay for. Customers aren't willing to make any sacrifices. And it has to be out there in volume. If we're going to improve the environment and reduce petroleum, we've absolutely got to do it in volume.

Bringing to bear the lessons of the past and the market as it exists today, where's the next milestone when you ask yourself, where is GM's campaign going? What are your metrics going forward?

I look at it as the whole picture. I do think it's important for us to do our part with respect to vehicle production. Together with Ford and DaimlerChrysler , we've announced we will double production of our E85 vehicles by 2010. We'll continue our awareness campaign because as everybody's taught me in the marketing and PR world, when I'm sick of it, people will just start thinking that they may have heard something about it.

The retail stations are the other important component. We're building stations, we're trying to bring together producers and retailers and get the station momentum building. The tipping point is really when the consumer can buy E85 in their local station. Now I don't think that means you have to have one on every corner but, at least, readily accessible.

Early on, the Brazilian experiment to adapt to ethanol fuels was affected by shortages. But, as you know, by 2007, 100% of all new Brazilian cars are expected to run on 100% ethanol. What's your perspective on actual and potential ethanol shortages at home?

There's been a period for the past few months where there's been a shortage of ethanol because it is being used for E10. But, we believe that will take care of itself. There are a large number of production investments out there—up to 32 are on the drawing board. And, the last energy bill calls for 7.5 billion gallons by 2012, such that people have the assurance that if they produce that there will be a market for it. There are some estimates that it could go up to 12 billion. We really believe the split pie is going to work itself out. As oil continues to be volatile and high, these investments look pretty darn good.

Wal-Mart has been mulling a national rollout of E85 at its retail locations, which would provide a big boon for the fuel, both in terms of press and availability. Can you tell us anything about these plans?

We're a part of the Energy Future coalition, which calls for "25 by 25"—25% renewable fuels by 2025. Likewise, Wal-Mart has had two symposiums investigating the issues around biofuels, including a possible national rollout. We're obviously very interested. I would just say, stay tuned.

The summer documentary Who Killed the Electric Car? was pretty hard on GM for scrapping the EV1 electrical car program. Did that film have any influence on you current projects?

What we learned from EV1 really was that customers don't make trade-offs. Obviously, we're very familiar with the documentary. The bottom line is there's no auto manufacturer today that's mass producing electric vehicles. No one can make the business case. That's pretty simple. The technology and the people who worked on EV1 are exactly the ones working on our fuel cells and hybrids. All that we learned was not lost.

Finally, your major foreign competitor, Toyota , has had much success with its Prius hybrid. In fact, many people consider it one of the best marketing campaigns in auto history. Any lessons to be learned there?

I do think when you come together as one company around a product plan consistently, it works. There's no doubt that the success of that campaign was based on the consistency of message. As far as perception and reality go, there's been a lot written about that. But, it's a very important example to look at in terms of lessons. The lesson is: Give consumers something they're interested in, but also get the marketing and messaging in line.

Click here for a slide show on ethanol cars.

Vella is a reporter for in New York

Copyright 2000- 2006 by The McGraw-Hill Companies Inc.
All rights reserved.

Friday, August 25, 2006

GM improves fuel efficiency with new Aveo

GM improves fuel efficiency with new Aveo
Posted 8/17/2006 10:51 PM ET
By Sharon Silke Carty, USA TODAY

DETROIT — Weary of its image as an automaker that pushes only gas-guzzling pickups and SUVs, General Motors on Thursday launched a redesigned iteration of the gas-friendly Chevrolet Aveo sedan just 2½ years after the original one arrived.

In some ways, the timing of the new Aveo couldn't be better. Consumers, facing the reality that high gas prices may be here for the long run, are increasingly turning to more-fuel-efficient cars and eschewing pickups and SUVs. Car sales are up 2.2% this year through July, while truck sales are down 10.6%, according to Autodata.

"Certainly with the price of gas being what it is, people are looking for" better gas mileage in their cars, said Ed Peper, general manager of the Chevrolet brand.

To satisfy that demand, GM worked to improve the fuel economy of the redesigned Aveo. The manual transmission version gets up to 37 miles per gallon on the highway. That's competitive with other small cars, including Toyota Yaris, which gets 39 mpg on the highway, and Kia Rio and Honda Fit, which get 38 mpg.

Subcompacts are the fastest-growing segment in the auto industry, said Jesse Toprak, director of pricing and industry analysis for consumer website Subcompacts were 19.4% of sales in July, up from 15% in July 2004.

"That may not seem like a big deal, but it is tremendous growth for any given category," Toprak said.

With that growth has come a number of new models, including Yaris, Fit and Nissan Versa. While rebates and incentives in the subcompact market have been on the decline, they could go back up this fall as customers shop around.

Subcompacts are "going to have to compete really hard, because now there are a lot of options," Toprak said.

The small-car market is notoriously difficult to make money in. The Aveo sedan will start at $12,995, and incentives could eat away at already thin profit margins.

And while Aveo may be as fuel-efficient as its competitors, Chevrolet doesn't yet have a reputation for building lean cars. Kevin Reale, an analyst at AMR Research, said Toyota and Honda worked on developing their images of providing gas-sipping cars long before it became trendy.

"Right now, reputation is overcoming reality," he said. "GM may have 30 cars that get over 30 miles to the gallon, but the perception is that they build gas-guzzling vehicles."

Chevy plans to hype the new Aveo as a well-stocked, well-priced option for young, trendy drivers. About 50% of its advertising budget will be spent online, said Cheryl Catton, Chevy car marketing director, with the rest of the "tongue-in-cheek" ads running in print and on TV.

Buyers 18 to 34 "spend a lot of time on the Internet," Catton said. "We want to be where they are."

Posted 8/17/2006 10:51 PM ET
Copyright 2006 USA TODAY, a division of Gannett Co. Inc.

Thursday, August 24, 2006

Auto reality: Adapt or die

Saturday, August 12, 2006
Auto reality: Adapt or die
Competition, higher labor costs and rising raw material prices create big challenges.
Bryce G. Hoffman and David Shepardson / The Detroit News

TRAVERSE CITY -- Amid anticipation for the upcoming Woodward Dream Cruise -- Metro Detroit's nostalgic celebration of Detroit-made metal -- auto executives gathered in Traverse City this week and acknowledged a painful truth: The good-old days are over and they're not coming back.

The challenges that automakers and their parts suppliers have been grappling with in recent years are not cyclical, but sweeping and structural. The industry is global now, the competition unrelenting. Low-cost rules. Every company must adapt to this new reality or die trying.

That was the message delivered by speaker after speaker at the Management Briefing Seminars, an annual auto industry conference organized by the Center for Automotive Research, an Ann Arbor think tank.

The official theme of the event was "The Auto World Future: Round or Flat?" General Motors Corp. Chairman and CEO Rick Wagoner spoke for many when he said he didn't know the answer.

"I do know the world is changing," he said, "and fast."

In recent years, the conference has focused on what organizers dubbed "the perfect storm" -- the convergence of increasing competition, rising raw material prices and growing labor costs.

This combination has helped erode the dominance of Detroit automakers in the U.S. auto industry -- Toyota Motor Corp. surpassed Ford Motor Co. for the first time in July auto sales and continues to gain ground on No. 1 GM -- and has sunk more than one supplier.

Conversations in Traverse City used to center on ways to survive the tempest more or less intact. This year, most speakers talked about the need to embrace this chaos as the new business reality.

"The automotive world's been turned upside down," said Richard Dauch, chairman and CEO of Detroit-based American Axle & Manufacturing Inc. He urged companies to set up manufacturing in India and China, which have labor costs as low as one-fiftieth of those in this country.

"If you don't, you're gone," Dauch said. "If you can't handle the medicine, go ahead and die."

He said there are just 10,000 suppliers in the United States today, compared with 30,000 in 1990. He predicted that number will fall to about 4,000 by 2010.

David Cole, chairman of the Center for Automotive Research, pointed to the traumatic restructurings under way at GM and Ford as proof the industry has reached a watershed moment. Both companies are closing factories and slashing tens of thousands of jobs to restore profits.

"The entire domestic industry is fighting for its life -- and I would include Chrysler in that," he told The Detroit News. This crisis was necessary to spur the turnaround efforts in Detroit today, Cole said. "They had to be scared."

It seems to be working.

"Our industry will continue to go through enormous transformations in the next decade as we determine the future of personal transportation," predicted Mark Fields, president of Ford's Americas group.

"Listening to our customers has never been more important. We as an industry can't sit back and complain about these changes. We have to act on them and quickly. The old saying, 'If you build it, they will buy it' needs to be put to rest."

Bruce Coventry, president of DaimlerChrysler AG's global engine manufacturing alliance, said other countries are doing more to embrace the new realities. While the United States faces a looming shortage of engineers, China is graduating 600,000 a year.

"If you want one year of prosperity, grow seeds," Coventry said, quoting a Chinese proverb. "If you want 10 years of prosperity, grow trees. If you want 100 years of prosperity, grow people."

Companies also must do more to adapt to the new market conditions.

"If you're not committed to this industry, it's going to be very tough," said Bo Andersson, GM's vice president of purchasing. "This is an industry that doesn't forgive mistakes easily and will leave you behind."

Driving this harsh reality home were the venture capitalists and hedge fund managers in Traverse City shopping for investment targets in the form of struggling auto parts makers. They included Barclays Capital, Deloitte & Touche Investment Banking and Bain Capital, among others.

The worst case scenario, said Brad Coulter of Amherst Partners LLC, a Michigan investment banking and consulting firm, is the loss of 50 percent of North America's suppliers within five years.

Of those that go missing, 65 percent are expected to go out of business entirely. The rest likely will be bought by private equity firms or other suppliers.

There have been 681-auto related mergers and acquisitions in the last 12 months, Coulter said. Four of the top 10 buyers, in dollar terms, are private equity firms. Indian and Chinese interests also are starting to shop, he said, adding that small and midsize suppliers are most at risk of failing, including many minority auto suppliers.

During a conference session Friday, one Michigan supplier submitted a written question asking how it should go about attracting a buyout from China. Analysts even talked about whether Chinese firms might buy Ford's British Jaguar brand or perhaps a majority interest in all of Ford's luxury Premier Auto Group, which includes Sweden's Volvo and Britain's Land Rover.

A Chinese firm bought MG Rover last year.

"To be a survivor, we must pay attention to competitiveness," said Linda Hasenfratz, CEO of supplier Linamar Corp. "You can be on the right track, but you will still get run over if you just sit there.

"There will be fewer OEMs and certainly fewer suppliers."

You can reach Bryce Hoffman at (313) 222-2443 or

© Copyright 2006 The Detroit News. All rights reserved.

Wednesday, August 23, 2006

Here's a new twist: Cars without gas caps

Thursday, August 10, 2006
Here's a new twist: Cars without gas caps
Bryce G. Hoffman and David Shepardson / The Detroit News

TRAVERSE CITY -- The hot technology topic at this year's auto industry confab in Traverse City is not a cool innovation like adaptive cruise control or iPod integration.

No, it's gas caps.

General Motors Corp. and DaimlerChrysler AG's Chrysler Group plan to add bright yellow ones to cars and trucks that can run on E85 -- a blend of 85 percent ethanol and 15 percent gasoline -- to build consumer awareness of the alternative fuel.

Ford Motor Co. plans to get rid of gas caps altogether, replacing them with a capless system that the automaker says is easier to use and easier on the environment.

Ford's capless fuel filler is already featured on its high-end Ford GT sports car. It will be standard on the new Lincoln MKS sedan, scheduled to hit showrooms in 2008, and migrate to other Ford, Lincoln and Mercury models.

"It eliminates the inconvenience of forgetting to put your gas cap back on after refueling," Mark Fields, president of Ford's Americas group said Wednesday at the Management Briefing Seminars. "It's also better for the environment because no gas fumes escape. It's the direct result of listening to our customers."

GM and Chrysler want to start talking to their customers about ethanol and have decided the best way to do it is by installing bright yellow fuel caps on all of their so-called "flex-fuel" cars and trucks -- vehicles capable of running on gasoline, E85 or a mixture of both.

GM already has more than 2 million E85-capable vehicles on the road, but many consumers may not know they can use the corn-based fuel alternative.

Next week, GM will announce plans to notify owners of flexible-fuel models that they can get the yellow caps or a special badge, or both, depending on the model year, to identify their vehicles as flex-fuel models, said GM spokesman Dave Barthmuss. GM did not promote the E85 capabilities of its flex-fuel vehicles before because gas was still relatively cheap and ethanol hard to find. Even now, E85 is only available at about 800 of the nation's 180,000 gas stations, including 16 already open or soon to open in Michigan.

Next year, Chrysler will start installing the same yellow caps on its flex-fuel vehicles.

"(It) lets consumers know at a glance that their vehicle is flex-fuel capable," said Chrysler Chief Operating Officer Eric Ridenour. He said Chrysler and GM will jointly purchase the caps from the same supplier to take advantage of volume price discounts.

Chrysler will also start adding flex-fuel badges to all E85-compatible 2007 models. Ridenour said that 10 percent of all Chrysler Group vehicles produced over the past eight years are flex-fuel capable.

"Ethanol-based fuels like E85 are a part of a viable, long-term strategy for our nation's energy security," Ridenour said. "If all the flex-fuel vehicles on the road in 2008 run on E85, our country would save 4.5 billion gallons of petroleum annually -- roughly one-third the amount of oil we import from Iraq each year."

You can reach Bryce Hoffman at (313) 222-2443 or

© Copyright 2006 The Detroit News. All rights reserved.

Tuesday, August 22, 2006

Backing America

Thursday, August 10, 2006
Backing America
Auto execs rally for U.S. industry
David Shepardson / Detroit News Washington Bureau

TRAVERSE CITY -- American Axle & Manufacturing Inc. CEO Dick Dauch didn't sugarcoat his comments Wednesday as he spoke of the negativity gripping the U.S. auto industry.

He asked why we've stopped honoring American manufacturing. As for the notion that Japan's Nissan Motor Co. and France's Renault SA need to ride to General Motors Corp.'s rescue, he dismissed it as "garbage."

"We don't need to have the French owning America," said Dauch, a former GM executive.

As he ended his speech, an image of Uncle Sam on an old Army recruiting poster appeared on the giant screen behind him.

This week, as automotive leaders gather in Traverse City for the industry's annual Management Briefing Seminars, the gloom and doom enveloping Detroit may be Topic A. But Dauch and other prominent executives are sounding a call for patriotism, optimism and a belief in the future of the American auto industry.

Ford Motor Co.'s North American President Mark Fields spoke Wednesday about how Asian governments value and root for their domestic manufacturers, while Detroit's automakers often feel ignored by policymakers and bashed by the media.

"This dismissive portrayal of Detroit and the cynicism we sometimes have for the home team is like nothing I've ever seen before," said Fields, who previously ran Ford operations in Japan and Europe. "It's time to believe in ourselves again -- so that consumers around us can do the same.

"The health of the U.S. auto industry needs to be important to everyone -- even if you don't work for a U.S. auto company or drive an American car."

The executives' rallying efforts come as the U.S. auto industry struggles through one of its most severe crises, with Detroit's Big Three shuttering factories, laying off workers and shifting supply work overseas.

Dauch said the number of auto suppliers has dropped from 30,000 in 1990 to 10,000 today and is expected to drop to less than 4,000 by 2010.

"It is like ships passing in the night. North American suppliers are establishing locations outside their home base to maintain business with their current customer base. Non-U.S. suppliers are coming to North America to support the new domestics," Dauch said.

He ended his talk on a grim note:

"I hope to see the survivors back here in Traverse City next year."

Detroit executives are pounding home the message that investments made by their companies are critical to the U.S. economy.

Fields noted that the Big Three have invested $39 billion in the United States over the past four years -- more than all the foreign automakers have spent here in the past 25 years.

Chrysler Group Chief Operating Officer Eric Ridenour echoed Fields, saying the company had recently invested $2.2 billion in southeast Michigan.

In May, Ford began funding a public relations campaign designed to emphasize the economic impact of the domestic industry through group called the Level Field Initiative.

The claims are largely in response to advertising by Toyota Motor Corp. and Honda Motor Co. touting their investments and the number of U.S. jobs they have created.

Level Field has paid for TV and print advertisements emphasizing that "not all automakers are the same."

Level Field's president, Jim Doyle, a former Clinton Administration official, is in Traverse City this week gathering information for the group's publicity campaign.

"If domestic automakers did as little of their production, design, engineering and other critical activities here in the U.S. as foreign automakers do, we'd lose about half the automaker jobs currently here in the U.S.," Doyle said.

Honda's senior vice president of automotive operations, John Mendel, countered that the American question was a "nonissue for us."

"Eighty percent of what we sell here we build here. We import fewer cars than Ford Motor Co.," Mendel said. "Is Ford a U.S. company any less than Honda's a U.S. company? I think those lines have blurred enough where people are saying, 'I know what I want. I'm going to buy what I want. I really don't care where it's built, unless it's someone producing products in sweatshops that I fundamentally oppose.' Is DaimlerChrysler a U.S. company?"

Honda spokesman Ed Miller clarified that Mendel's comparison to Ford included Mazda imports.

Long gone are the days when foreign cars were burned or crushed in public demonstrations in Michigan and elsewhere in the Midwest. Detroit's automakers are all aligned with foreign makes and import vehicles from Mexico.

But that doesn't necessarily mean the patriotic rhetoric no longer resonates, said David Cole, head of the Ann Arbor-based Center for Automotive Research, which organizes the Traverse City event.

Cole said the idea is not "to convince people to buy bad American-made cars," but "to make people aware of the impact of the domestic industry."

You can reach David Shepardson at 202-662-8735 or

© Copyright 2006 The Detroit News. All rights reserved.

GM exec has story for grandkids

Saturday, August 12, 2006
Business Insider
GM exec has story for grandkids
The Detroit News

The perks of his job are as big as the challenges for Mark LaNeve, General Motors Corp.'s head of North American marketing and sales. So he may have to figure out a way to boost GM's flagging market share, but he also gets to play golf with Tiger Woods and Jerome Bettis. The trio hit the links together during the Pro-Am at the Buick Open in Grand Blanc earlier this month. Business Insider asked LaNeve to describe teeing it up next to El Tigre and The Bus, and this was his account: "I met Tiger for the first time on the first tee and five minutes later he's hitting a laser beam 300 yards down the middle. Somehow, hitting next, I managed to hit one in the fairway and make par and that was a great feeling. Tiger is a regular guy -- except he is Tiger Woods. It was a great experience to play with him and we had a lot of fun with the Bus."

An Element of surprise

The Japanese have a knack for creating niches by spotting opportunities others have missed. They were the first, for instance, to develop the highly popular crossovers -- sport-utility vehicles built on car platforms. How about a sedan for customers hankering for an ordinary-looking vehicle with just a smidgen of pep? Toyota is trying to corner this market with a sport edition of the Camry. Now rival Honda Motor Co. has come up with an even more oxymoronic offering -- a sport-tuned version of the boxy Element. Honda says the Element SC comes with a sportier suspension and projector beam headlights. But where does the spoiler go?

Pick your battles

Toyota Motor Corp. and GM are fighting it out for the title of world's No. 1 automaker. But Gary Convis, one of Toyota's highest-ranking U.S. executives, doubts he'd want to face GM CEO Rick Wagoner on the basketball court. Convis grew up in Battle Creek and played for the Michigan State Spartans. Wagoner hit the boards for round ball powerhouse Duke University and once dreamed of a career in the NBA. The two executives shared the stage this week for a discussion about the future of the auto industry during the annual Management Briefing Seminars in Traverse City. "These days, I still do OK playing hoops against most Toyota executives -- at least those that are around five feet tall," Convis cracked. "But I'm not sure I want to get on the court with you, Rick."

Details, details, details

Bo Andersson, GM's top purchasing executive, is known for his impressive command of details, a skill that was on display this week in Traverse City. It happened this way: John Krafcik, Hyundai's vice president of strategic planning and product development in the Unites States, was asked when the Korean automaker would launch its own luxury nameplate in the mold of Toyota Motor Corp.'s Lexus brand. Krafcik declined to answer, saying he didn't want to tip off his competitors, including Andersson. Asked how many suppliers Hyundai has, Krafcik replied: "Ask Bo Andersson." Later that day, Andersson opened his speech by reporting that Hyundai has 440 suppliers, including 64 that serve both GM and Hyundai, and that Hyundai would announce a luxury brand on Oct. 16. He said the name would start with an A or a P, because in the alphabet both are seven letters away from H -- for Hyundai -- and Toyota is seven letters long. It wasn't clear if Andersson was joking.

Like father, like daughter

Andersson's cost-cutting zeal has apparently filtered down to his 14-year-old daughter, who went to Saks Fifth Avenue and saw a $120 necklace she wanted to buy with her own money. She checked out the Internet and got "25 price quotes," Andersson said, and eventually bought the necklace online from an outfit in Hawaii. She then took it to Saks to compare and reported that it was identical. "It's scary," Andersson said. "Now she's benchmarking everything. She thinks her weekly allowance is too low."


After years of enduring golf and fishing tales from David Cole, loquacious impresario of the annual Management Briefing Seminars in Traverse City, some auto executives served up some gentle ribbing this week.

DaimlerChrysler AG's Eric Ridenour, arriving with a slide show, suggested novel incentives for next year's attendees.

"Accumulate enough frequent fly-fisher miles and win an outing with Dave Cole. See the angling expert up close, and perhaps become immortalized in Dave's fishing stories for years to come," Ridenour said, projecting an image of Cole holding an enormous fish.

Or, No Fly Zone, a conference track completely free of fishing stories and golf jokes.

And finally, "Traverse Shizzle," a special package featuring a free round of golf and a trip to the casino with rapper and occasional Chrysler pitchman Snoop Dogg.

Contributors: Mark Truby, David Shepardson, Bryce Hoffman and Christine Tierney.

© Copyright 2006 The Detroit News. All rights reserved.

Sunday, August 20, 2006

GM, Ford make quality strides

Thursday, August 10, 2006
GM, Ford make quality strides
Mercury, Buick, Cadillac take 3 of top 5 survey spots
Josee Valcourt / The Detroit News

Toyota and its luxury Lexus brand still set the standard, but Detroit automakers, led by Ford Motor Co., are making impressive strides in long-term quality and are outperforming many foreign rivals, according to a closely watched industry study released Wednesday.

While Lexus was the top brand, Ford's Mercury brand and General Motors Corp.'s Buick and Cadillac marques rounded out the top four, according to J.D. Power and Associates' 2006 Vehicle Dependability Study.

Toyota and Lexus won top honors in eight individual categories, more than any other company. At the same time, though, several GM and Ford vehicles also were named the best in their segments.

"It proves the capability of Ford and the domestic automakers to compete in quality," Anne Stevens, chief operating officer of Ford's Americas division, said in an interview.

J.D. Power, which surveyed nearly 50,000 owners of 2003 models about their vehicle woes in the first three years of ownership, found that, with a few exceptions, automakers across the board are improving long-term quality and durability.

"Manufacturers are listening to the customers and starting to implement quality measures at the plants," said Neal Oddes, director of product research and analysis for J.D. Power.

The overall industry average improved from 237 problems per 100 vehicles in 2005 to 227 problems per 100 vehicles in 2006.

Additionally, mass-market vehicles appear to be catching luxury brands in long-term quality, narrowing the gap in reported problems, Oddes said.

Improvements in ride, handling, braking and powertrains for the high-volume brands helped push those vehicles closer to the luxury brands.

Those attributes, according to the study, have a strong impact on customer satisfaction.

J.D. Power's initial quality study, which measures problems in the first 90 days of ownership, typically gets more attention.

But Oddes said the dependability study is important for automakers because how owners feel about their car or truck after three years of ownership can affect the make and model they choose the next time they're in the market for a new vehicle. When an automaker's vehicles are considered dependable, brands retain value, loyalty increases and consumers often recommend them to friends, Oddes said. Automakers also spend less on warranty costs.

"What we see is that as quality improves, the need for replacing components decreases at the same pace," Oddes said.

The gains in long-term quality among Detroit automakers in part reflect their response to the growing dominance of Asian manufacturers in the U.S. market.

GM, Ford and Chrysler have been criticized for lagging their foreign rivals on quality, especially Toyota.

That gap has hurt their image and cost them sales as ever more American consumers turned to import models.

But Detroit automakers have made improving quality a priority, and this year's study shows they're making progress.

All of Ford's domestic brands -- Ford, Lincoln and Mercury -- outperformed the industry average. The results represent a breakthrough for Ford, which has struggled to improve quality.

Ford's Mercury division finished second among brands behind Lexus. Lincoln, however, had more problems per 100 vehicles than in 2005.

"We are extremely pleased with the result," Stevens said. "This is proof of the hard work the teams in Ford are doing."

"Mercury leading the nonpremium nameplates is fantastic for the company."

General Motors Corp.'s Buick and Cadillac brands also fared well, nabbing the No. 3 and No. 4 slots among top performers. Those GM brands outperformed Toyota, the acknowledged quality leader.

Janine Fruehan, a GM spokeswoman, said the results show the company's push over the past several years to improve quality at every level of the car-building process is working.

"Our focus is to build them right the first time," Fruehan said.

Despite the encouraging signs, Detroit automakers still have room to improve. Among the 10 best performers in the study, seven were import brands.

GM's highest volume brands -- Chevrolet, GMC, Pontiac and Saturn -- all scored below average in the J.D. Power survey.

"We're a large company and we have huge portfolio so there is a tendency to have mixed results," Fruehan said.

"But if we look at other metrics, warranty performance (for those brands) has improved over the five years by 40 percent."

And while the Chrysler Group's trio of brands -- Chrysler, Jeep and Dodge -- each scored better than last year, all had below-average rankings.

That was a slip for the Chrysler brand, which finished above average last year, although it still ranked better this year than its luxury sister marque, Mercedes-Benz.

"Chrysler has slipped behind the industry average, but again you take into consideration in the four-year period they do show quite a considerable improvement from 2003 to 2006," Oddes said. "Chrysler is moving at a greater pace than the industry."

Mercedes, which has been dented by quality problems, also has shown tremendous improvement from last year, he said.

Though Mini and Kia remain near the bottom of the rankings overall, the two were the most improved brands in the study.

Jaguar, owned by Ford, was the third most improved and was the highest-ranking European brand.

The results, particularly for domestic carmakers, indicate that they're addressing quality at the start of production at factories rather than tackling problems late in the manufacturing process, said Michelle Hill, director of North America benchmarking for Harbour Consulting Inc.

"They're focusing on getting the quality right from the start," said Hill, adding that Harbour, which measures productivity in auto factories, has seen a correlation between improved quality and higher productivity among domestic brands.

You can reach Josee Valcourt at (313) 222-2300 or

© Copyright 2006 The Detroit News. All rights reserved.

Delphi hearing delay raises hopes

Saturday, August 12, 2006
Delphi hearing delay raises hopes
Request for more time could signal progress in talks to avert strike; case will resume Thursday.
Terry Kosdrosk and John D. Stoll / Dow Jones Newswires

DETROIT -- Auto parts supplier Delphi Corp.'s approval to get a hearing on labor contracts delayed until Thursday raises hopes that progress can be made in talks aimed at reaching a settlement and avoiding a possible strike.

Delphi, which filed for bankruptcy in October, said its request to delay the hearing on getting its labor contracts thrown out was intended to facilitate continuing discussions with former parent General Motors Corp., the United Auto Workers and other unions.

"There were productive and high-level meetings conducted all day, late into the day (Thursday)," Delphi spokesman Lindsey Williams said Friday. Williams said multiple parties are participating in the talks, including various committees involved in the bankruptcy proceedings, such as the creditors' committee.

In a statement released Friday, the UAW insisted that "even with the suspension of court proceedings, discussions have been weighed down by Delphi's focus on their bankruptcy strategy."

While discussions with Delphi and GM continued through July, "the talks were at best disappointing," the UAW said. "Delphi's negotiators would not enter into any discussion which might be viewed in court as a departure from their November proposal."

That proposal to union workers included demands for a dramatic cut in compensation packages, including wage, benefit and pension cuts. Instead of revisiting wages and benefits, Delphi negotiators insisted on centering discussions on Delphi's plans with manufacturing plants, product lines and the impact of an accelerated attrition plan on Delphi's labor costs.

GM, Delphi's top customer, plays a key role in the talks because the parts supplier is a former GM subsidiary and Delphi continues to provide about $15 billion annually in components to the automaker. GM has various contractual obligations to Delphi workers who used to be employed by the automaker.

The Troy-based parts supplier has repeatedly delayed hearings related to its motion to throw out labor contracts. The motion has caused a whirlwind of controversy among Delphi's labor unions and sparked serious concerns that hourly workers may eventually strike against the supplier -- leading to disruptions in GM's production activities.

Often, a move to delay such hearings by a bankrupt company indicates progress in labor talks. Judges routinely grant delays to allow the parties to sort out differences.

GM spokeswoman Toni Simonetti declined to comment directly on Delphi's plans for a delay, but said GM remains committed to finding a mutually acceptable solution "that allows Delphi to emerge from bankruptcy as a strong supplier."

GM, the unions and Delphi are working to firm up a consensual pact that addresses Delphi's high structural costs and expenses related to retirees, while also satisfying GM and the UAW. On Thursday, GM Chief Executive Rick Wagoner characterized the talks as complex and "mind bending," and said that the multiple moving parts of the negotiations are at the root of prolonged negotiations.

In addition to Delphi's demands for lower wages and relief from retiree obligations, GM also is negotiating terms of supply contracts, some of which Delphi is asking the bankruptcy court to throw out. GM, Delphi and the unions have already agreed to a variety of initiatives aimed at cutting Delphi's work force and labor costs, including an accelerated attrition program that is ongoing.

© Copyright 2006 The Detroit News. All rights reserved.

GM cuts spending on midsize cars by $1B

Tuesday, August 08, 2006
GM cuts spending on midsize cars by $1B
Bloomberg News

General Motors Corp., the world's largest automaker, will cut costs for new midsize car models by a third as it rolls out a system for sharing parts, vehicle designs and factories, a top manufacturing executive said.

Plants in three regions will be able to build 19 variations of brands and styles such as Chevrolet Malibu sedans and Saab convertibles, Jim Wiemels, GM vice president of global manufacturing engineering, said during a JP Morgan investor conference Monday in Dearborn. The change will reduce spending on the cars by $1 billion, GM spokesman Dave Roman said.

The plan to pay less to develop and manufacture new vehicles is part of GM Chief Executive Officer Rick Wagoner's strategy for restoring profits and winning back buyers lost to competitors such as Toyota Motor Corp.

© Copyright 2006 The Detroit News. All rights reserved.

Crazy for color

Monday, August 07, 2006
Crazy for color
Right hues mean lots of green to GM, carmakers
Brett Clanton / The Detroit News

Have you heard? Blue is making a comeback. Green is so yesterday. And red is moving out of its lowbrow yellowy stage into a richer, blue period.

Or so says a highly specialized team of General Motors Corp. designers whose job it is to predict color trends.

Drawing from pop culture, economic trends and the buying patterns in other industries, the team spends its days trying to solve such riddles as how to make a better silver or what the "new" black will be. But there's at least one big headline in the color world these days.

"Blue is going to be the biggest story for '07, '08 and '09," said Christopher Webb, a color designer who works in an airy studio at GM's Tech Center in Warren that seems light-years away from the factories that build the automaker's cars and trucks.

The notion that a group of designers is paid to ponder the future of red and yellow may be vexing to some at a time when the world's No. 1 automaker is bleeding money, shedding thousands of jobs and closing plants just to survive.

But the business of forecasting color trends may be more important than ever to GM and other automakers.

Research shows that nearly 40 percent of consumers will defect to another brand if they can't find the vehicle color they want -- and GM is not about to miss out on sales simply because it picked the wrong paint color for a new Cadillac or Chevrolet.

In a break from the past, however, GM is trying to be more judicious about how it selects colors for the 9 million vehicles it sends out into the world every year.

The automaker used to think nothing of spending millions on developing slightly different colors for its individual brands and vehicle lines. Now, GM is paring down its international paint palette to help build stronger brand identities and bring more cost-saving uniformity to manufacturing.

At the same time, GM and other automakers are leading the way in developing high-tech finishes that add depth and texture to neutral paint colors, which tend to be the most popular.

Slowly but surely

The greater attention to color comes at a time when consumers are demanding more style from the everyday products they buy. Sharp color and design have suddenly become selling points for everything from kitchen utensils to washing machines at Sears.

But staying current can be tough for automakers, which must lock in vehicle designs and paint color choices about three years before a car or truck hits the market.

"People will sometimes treat us like the fashion industry," said David McKinnon, vice president of design at DaimlerChrysler AG's Chrysler Group, who oversees the Auburn Hills-based automaker's color lab. "Well, fashion can change in three months. We need three or four years. It's not a fast process."

At GM's color lab in Warren, the small design team just completed color selections for the 2009 model year and has begun working on 2010.

Housed on the second floor of the tech center's design building, the lab is a giant circular room where bulletin boards are covered with magazine clippings. Fashionably dressed workers labor amid a sea of nondescript car models perched on waist-high poles and painted in the dozens of colors GM has at its disposal.

"Gunmetal Metallic," "Lunar Quartz," "Antique Bronze" -- the colors go by a host of names that are printed on tiny labels below each model. But this is just the current lineup. Cabinets and storerooms flanking the lab store color swatches that span GM's nearly 100-year history.

Livelier hues

During a recent visit, the designers were excited about what they see as a "return to color" in vehicle paints and other consumer products such as cell phones and home appliances.

But don't expect an explosion of green, yellow and purple cars on the road in coming years. The trend is more about infusing neutral shades with more color so they have a richer, more complex appearance.

"Believe me, we want to have more colors," said Helen Emsley, GM's global director of design, color and trim.

But at the end of the day, more than 50 percent of consumers still select silver, black, beige or white when they go to buy a vehicle, she said.

To liven up those perennial -- some might say boring -- choices, GM is adding microscopic flakes to the paint that seem to change color in the light. One of the first applications is on the new Cadillac DTS sedan, which comes in a hue-shifting "Titanium" gray that can look almost green, or even violet, at times.

Despite a $1,000 extra charge for the high-tech coating, Titanium now accounts for 9 percent of DTS sales, compared with 6 percent in a regular gray.

But bolder, louder color choices also are gaining strength, particularly as interest grows in vehicle customization.

When Japan's Honda Motor Co. launched its boxy Element SUV in 2003, for instance, a rusty orange quickly became the most popular color choice, luring 20 percent of buyers.

During the past two years, blue broke into the top five vehicle color choices, and red made gains in 2005.

Perception is everything

Experts say color shifts go in cycles and could be driven by an improving economic climate or political and social trends. During the 1990s, for example, when the environmental movement rose to prominence, green was the most popular car color choice. In the past six years, silver has dominated -- a possible nod to the increasing role of technology in daily life.

"Let's face it, there are only seven colors in the spectrum," said Leatrice Eiseman, author of "The Color Answer Book" and executive director of the Pantone Color Institute in Carlstadt, N.J. "But it's what you do to those colors, the way that people perceive of them, that makes the difference."

GM's color designers routinely meet with their counterparts from other industries to ensure they are not blind to trends. Nike, Nokia, Herman Miller -- they've all been to Warren to trade thoughts with the world's largest automaker.

But one of the team's biggest missions in recent years has been to cut the waste and streamline its own processes.

Emsley said that when she took over the studio a few years ago, she asked her team to find every vehicle paint color GM used in North America, and stick a sample of each on a wall in the lab. The tally: 111 colors.

"I remember standing back and looking at this wall and saying, 'What the hell?' " said Emsley, who has since trimmed the number to around 60 colors at a savings of millions per year.

Karen Surcina -- color marketing and technology manager for DuPont Automotive Systems in Troy, one of the world's biggest vehicle paint suppliers -- said it can cost "hundreds of thousands of dollars" or more to develop a new color.

But a growing number of industries are willing to pay handsomely if adding more color means drawing more buyers.

In recent years, DuPont has received requests to develop colors for everyone from a golf cart builder to a home window maker. But the oddest inquiry may have come from a casket producer, which hoped to use color to spruce up an otherwise macabre product lineup.

While the company is happy for the business, Surcina said working with coffins would not be her first choice.

"I'd rather put color on cars."

You can reach Brett Clanton at (313) 222-2612 or bclanton@

© Copyright 2006 The Detroit News. All rights reserved.

Wagoner: Feds must do more

Friday, August 11, 2006
Wagoner: Feds must do more
GM CEO says Washington isn't showing leadership on crucial business issues like health care, energy policy.
David Shepardson / Detroit News Washington Bureau

TRAVERSE CITY -- General Motors Corp. Chairman and CEO Rick Wagoner sharply criticized government officials Thursday for failing to show leadership on crucial issues such as health care and energy.

"Some of the things that we all believe are necessary to ensure the continued strength of the (manufacturing) sector, which I think is just vital ... we just don't see the leadership," said Wagoner, speaking at the auto industry's Management Briefing Seminars in Traverse City.

Wagoner's comments followed similar sentiments expressed a day earlier in Traverse City by Mark Fields, Ford Motor Co.'s president of the Americas.

Wagoner and the CEOs of Ford and DaimlerChrysler AG's Chrysler Group have been asking for a sit-down with President Bush for months, but the meeting has been postponed at least twice.

Last month, Wagoner appeared on Capitol Hill asking Congress for a number of reforms to help businesses cope with runaway health care costs.

"They've just taken a complete pass on doing something about the health care situation," Wagoner said Thursday. "It's driving jobs out of the country."

On another topic, Wagoner also said GM has reduced its forecast for total U.S. auto sales to 17 million in 2006, down from 17.5 million in 2005. That number includes heavy trucks.

"If somebody would have told all of us that oil prices would be as high as they are today and auto sales in the U.S. would be staying and running at the rate they have, I think we'd probably have said, 'Wow that's a pretty a robust market,' " he said. "We're not overly negative, but certainly we have to be concerned."

He also said the company continues to make progress on talks with Delphi Corp., GM's former parts division. Delphi, with the financial assistance of GM, is trying to work out an agreement with United Auto Workers to lower wages and benefit levels that would avoid a potentially crippling strike.

Delphi and UAW are due in bankruptcy court today to resume hearings on Delphi's request to void union labor contracts.

Wagoner also said Thursday that GM is scaling back its production of newly redesigned large SUVs to make sure dealer inventories don't get too high. GM had planned to run plants on overtime for the rest of the year, which won't be necessary, he said.

But it was the normally reserved Wagoner's criticism of federal leaders that had auto industry insiders buzzing Thursday at the auto confab.

GM is the largest provider of health care in the United States, spending $5.3 billion to cover 1.1 million people in 2005. The company expects its health care costs to rise to $7.4 billion by 2009.

U.S. Rep. John Dingell, D-Dearborn, said the auto industry has been frustrated by a lack of action.

"Let's be honest -- this administration done nothing for the auto industry except to whine that they want a bailout when the industry doesn't want a bailout," said Dingell, adding that health care costs are becoming untenable for the many large businesses. "It's breaking industries all over the country."

Dingell noted that in next year's contract talks with the UAW, health care is sure to come up in what will be "a terrifying set of negotiations," Dingell said. UAW President Ron Gettlefinger is going to have "a hell of a time between a rock and a hard place" as the automakers demand more health care and other concessions.

Wagoner, echoing Fields comments Wednesday, said manufacturing isn't as valued in the United States as it is in some other countries.

"There is somewhat of an under appreciation of the importance of the manufacturing sector in the U.S.," he said. Fields made the same point in his appearance in Traverse City.

"In Asia, the approach is vastly different. Governments and consumers see the auto industry as strategically important, vital to national interests and deserving of full support at every level of their national economies. Asian nations value their established automakers, and they root them on to success," Fields said. Wednesday in Traverse City. Wagoner also said the federal government hadn't thoughtfully addressed the nation's energy issues.

"Energy policy is another good example: By simply taking a pass and say buy whatever's cheap, we have what we have today," Wagoner said. "If we want to have a policy which doesn't rely exclusively on imported oil, we're going to have do something other than every day toss up the ball and say, 'OK, go for the cheapest stuff.' There's got to be a more thoughtful policy than that."

Toyota Motor Manufacturing President Gary Convis, offered comments in support of Wagoner.

"A good energy policy is very important to the future of our kids," he said. "The government has to take a very proactive long-term role in that. There's a limited amount of resources and it doesn't take a brain surgeon to figure out that we have to do something different."

The Bush administration has sought authority to raise fuel economy requirements for passenger cars. The Big Three have strongly opposed efforts by some in Congress to mandate a specific fuel economy requirement.

Many observers agree that bills to reform fuel economy for passenger cars, which have remained at the same level since the mid-1980s, aren't going anywhere this year.

U.S. Sen. Debbie Stabenow, D-Lansing., said in an interview that she agreed with Wagoner's comments.

"I think I know who Rick was talking about," Stabenow said, blaming the Republicans. "The White House and Congress have not stepped up to support the auto industry and manufacturing in this country."

She's offered a series of bills to help the industry with its health care costs, especially catastrophic health care costs, which account for as much as a quarter of the $10 billion the Big Three spent on health care in 2005.

You can reach David Shepardson at (202) 662-8735 or

© Copyright 2006 The Detroit News. All rights reserved.

Thursday, August 17, 2006

Large investors sell parts of GM stock

Thursday, August 17, 2006
Large investors sell parts of GM stock
Two big stockholders unload a combined 28%; several others increase their holdings, filings say.
Tom Krisher / Associated Press

DETROIT -- Two of General Motors Corp.'s largest institutional investors have sold big blocks of the company's stock, but others have increased their holdings, according to regulatory filings.

Capital Research & Management Co., a Los Angeles-based investment firm that is GM's second-largest investor, sold 19.2 million shares, or 24 percent of its holdings in the company, according to second-quarter reports filed earlier this week with the Securities and Exchange Commission.

The company's third-largest investor, Brandes Investment Partners LP of San Diego, sold 2.4 million shares, or 4 percent of its holdings.

But other investors increased their stakes in the world's largest automaker, including Credit Suisse, which bought 11.5 million shares; Fidelity Management & Research, which purchased 6.8 million; and Franklin Mutual Advisers LLC, which bought 4.6 million, according to

"It's natural for investors to periodically rebalance their holdings," said GM spokeswoman Brenda Rios, who declined further comment.

Capital Research and Brandes said they do not comment on their investments.

Craig Fitzgerald, an auto analyst and partner with Plante & Moran in Southfield, said the transactions were the result of some investors who bought GM shares at a lower price taking a profit and others seeing signs of progress in GM's restructuring.

"GM in particular is continuing to do some of the key things they need to be doing," Fitzgerald said. "There's no reason to necessarily believe there isn't more upside in the short- and mid-term."

GM's stock price has risen more than 65 percent since it hit a 52-week low of $18.33 in December. The stock closed at $30.99, up 45 cents, Wednesday on the New York Stock Exchange.

© Copyright 2006 The Detroit News. All rights reserved.

GM reduces future liabilities by $23 billion

Tuesday, August 08, 2006
GM reduces future liabilities by $23 billion
David Shepardson / Detroit News Washington Bureau

WASHINGTON -- General Motors Corp. said Tuesday its future pension and health-care liabilities had declined by $23.2 billion in the wake of reductions in company's spending on benefits and the early retirement of 34,400 employees.

GM has said reducing its long-term obligations are essential to its recovery; under the new calculations, GM's has cut its pension obligations by $19.3 billion and its health-care obligations by $3.9 billion.

The larger-than-expected reductions come as GM won court approval on March 31 of an agreement with the United Auto Workers to reduce its health care costs by $1 billion annually -- and at the time said it would reduce its long-term liability by $15 billion.

The increase included new calculations that current workers would work longer and that the discount rate -- a factor used in accounting for future costs -- had increased, according to a 124-page GM filing with the U.S. Securities and Exchange Commission.

Earlier this year, GM said it would reduce pension benefits for current U.S. salaried employees by freezing accrued benefits in the current plan and implementing a new benefit, including a reduced defined benefit plan for some salaried employees and a new defined contribution plan for the other salaried employees.

GM is also increasing the U.S. salaried workforce's participation in the cost of health care.

Beginning Jan, 1, 2007, GM will cap contributions to salaried retiree health care at the level of its 2006 expenditures.

In its filing Tuesday, GM said this may lead to "higher monthly contributions, deductibles, coinsurance, out-of-pocket maximums, and prescription drug payments. Plan changes may be implemented in medical, dental, vision, and prescription drug plans."

You can reach David Shepardson at (202) 662 - 8735 or

© Copyright 2006 The Detroit News. All rights reserved.

Wednesday, August 16, 2006

Critics slam McDonald's Hummer toys

Thursday, August 10, 2006
Critics slam McDonald's Hummer toys
Chain calls kids' meal prizes a serving of fun; environmentalists say it taints firm's green gains.
Melanie Warner / New York Times

When General Motors introduced the 3-ton, 11-miles-to-the-gallon Hummer H2 four years ago, it redefined American extravagance. But with gas hovering at $3 a gallon and threatening to go higher, sales of Hummers are declining as Americans become increasingly conscious of gas mileage.

McDonald's, however, appears not to have gotten the message. This week, the restaurant chain started putting toy Hummers in children's Happy Meal boxes, calling it the "Hummer of a Summer" promotion. Television and radio ads, which started running this week, feature a family riding in a Hummer on the way to McDonald's.

With enough visits to McDonald's, kids will be able to collect eight different Hummers in a variety of colors, including two versions of the H1, the original and most monstrous member of the Hummer family, which General Motors stopped making in June.

The promotion runs until the end of August and is aimed at young boys. Girls can choose to get Polly Pocket fashion dolls in their Happy Meals instead.

Environmental groups are appalled with the promotion. Brendan Bell, a clean energy analyst at the Sierra Club, says Hummers in Happy Meals are about as responsible as "dipping a Big Mac in the fry oil and serving it to your kids."

McDonald's is trying to make Hummers look cool, Bell said, but the vehicles are anything but.

"The technology is passe," he said. "For the H1 and H2, they're running it off an engine that hasn't been fundamentally redesigned since 1950s. What the next generation needs is better technology in our vehicles so that we can cut our dependence on oil and curb global warming."

In a written statement, Bill Lamar, McDonald's chief marketing officer, said the promotion was intended to bring "the fun and excitement of Hummer vehicles" to "McDonald's youngest guests." The company did not make anyone available for an interview.

General Motors says the H2 and H3 benefit from a "host of advanced technologies" and that the H2's Vortec "is one of the most efficient engines in production today."

© Copyright 2006 The Detroit News. All rights reserved.

GM reduces debts by $23B

Wednesday, August 09, 2006
GM reduces debts by $23B
Automaker cuts its long-term pension and health care liabilities in attempts to trim costs.
David Shepardson / Detroit News Washington Bureau

WASHINGTON -- General Motors Corp. said Tuesday it had reduced its long-term pension and health care liabilities by $23 billion, part of the automaker's efforts to get a handle on its enormous legacy costs.

In its latest financial statement, GM's pension liability was reduced by $3.9 billion, or 4.4 percent to $85 billion as a result of an improvement in accounting assumptions used to calculate long-term obligations. It also reduced its health care liabilities by $19.3 billion to $62 billion.

The reduced obligations are due, in part, to the decision of 4,400 workers to take buyouts that paid them up to $140,000 to leave the company but limit any future pension obligations.

The company's savings also stemmed from retiree health care changes.

On March 31, a federal judge approved a plan to reduce GM's health costs for hourly retirees by $1 billion. All but the retired hourly workers with the smallest pensions are now paying monthly contributions, deductibles and co-payments for medical services up to a maximum of $370 a year for individuals and $752 for a family. Initially, GM had said the deal would only decrease its long-term obligations by $15 billion.

Kevin Reale, research director in the automotive practice at AMR, said the numbers were an improvement.

"Anything they can do to reduce the obligation is a bonus," Reale said. "They need to be able to shift more dollars to research and development to what they are paying for health care costs."

GM is the largest provider of private health care in the United States. It covers 1.1 million people, of which 530,000 are older than 60.

The company spent $5.3 billion in 2005 on health care. Its prescription drug costs alone were $1.9 billion in 2005, and it said earlier this year it expects its health care costs to soar to $7.4 billion by 2009.

GM has been able to cushion the financial blow through the use of a trust fund, which on June 30 had $18.4 billion.

The automaker withdrew $2 billion from the trust fund on July 31 to pay hourly-retiree health-care and life insurance. GM also withdrew $2 billion in the year.

GM has said it would reduce pension benefits for current U.S. salaried employees by freezing accrued benefits.

Beginning Jan., 1, GM will cap contributions to salaried retiree health care at the level of its 2006 expenditures.

In its filing Tuesday, GM said this may lead to "higher monthly contributions, deductibles, coinsurance, out-of-pocket maximums, and prescription drug payments. Plan changes may be implemented in medical, dental, vision, and prescription drug plans."

Last month, GM said it would take a $3.7 billion charge due to 34,400 early retirements and buyouts. The company will take a $300 million charge later this year to reflect health care costs due to the hourly employees' early retirements, GM spokeswoman Brenda Rios said.

You can reach David Shepardson at (202) 662 - 8735 or

© Copyright 2006 The Detroit News. All rights reserved.

Other disclosures

GM's plan to cut its annual costs by $6 billion was on schedule, though it had seen its shipping costs increase by $150 million this year, due largely to higher fuel costs.

GM renogiated its $5.6 billion unsecured line of credit and now has a secured $4.5 billion line of credit

Tuesday, August 15, 2006

2007 GMC Yukon Denali

August 23, 2006
2007 GMC Yukon Denali
He Drove, She Drove
Yukon Denali shines as GM's best SUV
By Paul & Anita Lienert / Special to The Detroit News

Hip-hop artists and professional athletes seem to love the over-the-top styling of the new Cadillac Escalade. But they may be missing the best of General Motors' SUV triplets -- the redesigned 2007 GMC Yukon Denali.

More elegant and visually appealing than the Chevrolet Tahoe, but not as showy as the Escalade, the Yukon's looks should hold up well over time.

We tested a well-equipped Yukon Denali AWD with a bottom line of $54,615.

SHE: Remember our friends who got divorced because the wife kept leaning over from the passenger seat and honking the horn in traffic while the husband was driving?

HE: Sounds like perfectly reasonable grounds to me.

SHE: Granted, she was a bit of a control freak, but I can kind of relate to her on this test drive. Because I would like to reach over and change that 4 that you gave the Denali to a big, fat 5. I can't imagine why you'd give the best of GM's new SUVs less than our highest rating.

HE: Consider yourself divorced. The Yukon Denali is a nice vehicle -- but far from perfect. I'm not even convinced it's best in class, and that $54,000-plus sticker is certainly going to turn off a lot of potential buyers. I understand that GM is already heavily discounting these new SUVs, too, even though they've only been on the market for about six or seven months.

SHE: That's all about gas prices. And as we're sitting here, they're coming down. Fuel prices aside, this is one of the most majestic SUVs I've ever been in. I absolutely love the subtle exterior that manages to integrate some really dramatic touches, such as the oversize vertical taillights, and the intriguing grille that looks like it was drilled out on a machine.

HE: Too bad it's plastic, not metal. And majestic seems like an appropriate adjective for a vehicle that's so huge, it's a real pain to maneuver in a mall parking lot. And this is the short-wheelbase model -- the Denali XL is an even bigger pain. The EPA fuel economy numbers are far from majestic. This monster, with its massive 6.2-liter V-8, gulps fuel, to the tune of 13 miles per gallon in city driving and 19 on the highway. You can understand why people are getting pretty gun-shy around big SUVs these days, GM's bragging notwithstanding.

SHE: Don't kid yourself. The people who can afford this vehicle aren't going to be hampered by high pump prices. And what they'll get is a workhorse that's as ritzy as a rolling hotel room, with just about every amenity you can dream up.

HE: I know I groused about the lousy fuel economy, but I did like that big V-8. It makes 380 horsepower and 417 pounds-feet of torque, which incidentally is 100 pounds-feet more torque than the expensive Audi RS4 supercar we've been test-driving. The six-speed is smooth, too -- as you say, the best automatic transmission you can buy on a big SUV.

SHE: If I have any complaints, it's that there is virtually no room for luggage when you're using the third row of seats. And it would have been really terrific to have a power folding third row as a companion to the power feature in the second row.

HE: I thought the styling, the materials and the build quality in the cabin represented a dramatic improvement over the previous-generation Yukon. And that's despite the fact that the fake wood still looks too fake, especially on a $54,000 vehicle with luxury aspirations.

SHE: I can't understand why you are nit-picking one of the best products to come out of the Detroit pipeline this year. The GMC Yukon Denali is civilized, confidence-inspiring and cool. So move over and let me drive.

Anita and Paul Lienert are partners in Lienert & Lienert, a Detroit-based automotive information services company.

The 2007 GMC Yukon Denali combines power with elegance.

2007 GMC Yukon Denali AWD

Type: Front-engine, all-wheel drive, six-passenger utility vehicle.
Price: Base, $47,990 (inc. $875 shipping charge); as tested, $54,615.
Engine: 6.2-liter V-8; 380-hp; 417 lb-ft torque.
EPA fuel economy: 13 mpg city/19 mpg highway.
Where built: Janesville, Wis.
Estimated 12-month insurance cost, according to AAA Michigan: $1,762

Rating: 5
Likes: Best of GM's big SUV siblings. More elegant and understated, not as showy as the Cadillac Escalade. Fabulous safety equipment. Optional oversize 20-inch wheels/tires look and feel substantial. Comfortable ride.
Dislikes: With third row up, virtually no room for luggage. Visibility problems from thick rear pillars, headrests.

Rating: 4
Likes: Big, bold front-end styling. Powerful, torquey 6.2L V-8. Smooth six-speed automatic transmission. Dramatically better-looking cabin. Comfy captain's chairs, lots of amenities - and room - in second row. Easy to access third row.
Dislikes: Dreadful fuel economy. Interior wood trim still looks fake. Third row not nearly as civilized as second. Bulky size makes parking difficult.

© Copyright 2006 The Detroit News. All rights reserved.

Camaro Homecoming

Friday, August 11, 2006
Camaro Homecoming
7,000 employees and fans celebrate muscle car's return in '09
Brett Clanton / The Detroit News

WARREN -- The official announcement that General Motors Corp. is bringing back the Camaro came Thursday morning in Traverse City, where Chairman and CEO Rick Wagoner confirmed one of the worst-kept secrets in the auto industry.

But the party really revved up a short time later outside GM's Warren tech center. A crowd of about 7,000 GM employees and Camaro enthusiasts gathered on a grassy hill, where dozens of the classic muscle cars were parked near a makeshift stage.

Well-worn rock songs from the Camaro generation, including Steppenwolf's "Born to be Wild" and The Steve Miller Band's "Jungle Love," blared from a sound system.

Then, in a recreation of its debut at Cobo Center in Detroit during the North American International Auto Show in January, a silver Camaro concept car rolled down a long, cordoned-off path to park center stage, as a trio of GM executives began extolling its virtues.

"We're once again going to build the muscle car that dominated the streets of America and captured the hearts of automotive enthusiasts everywhere," said Ed Peper, Chevrolet's general manager.

Peper, who called the new Camaro a "shot in the arm" for GM dealers, the company and customers, said the updated muscle car will not be a niche vehicle, but a mainstream entry within reach of budget-conscious buyers designed to appeal to men and women, young and old. GM has not released specific pricing.

The original Camaro debuted in 1967 to take on Ford's mighty Mustang. Nearly 3.8 million were built before production ended in 2002. GM may build 100,000 of the new Camaros annually, Wagoner said. The car will feature rear-wheel drive and an independent rear suspension, and will be available with a manual or automatic transmission and a V-6 or V-8 engine.

GM's decision to go deeper into muscle cars, a vehicle category famous for high performance but poor fuel economy, may have been better-timed.

With gas prices topping $3 per gallon nationwide and Americans snapping up more fuel-efficient vehicles, a new Camaro could find trouble connecting with car buyers.

But Peper is not worried.

"I don't think Americans will ever get tired of muscle cars."

Wagoner said the new car will offer the option of increased fuel economy with the additional engine and transmission choices.

GM officials have estimated that a Camaro concept car equipped with a manual transmission and a V-8 engine that goes to four cylinders at highway speeds can get 30 or more miles per gallon of gas.

The Camaro concept is very close in appearance to the production model that will hit the market in 2009, GM design chief Ed Welburn said after the event

Buyers will notice only minor changes, such as a higher roof line, he said, after reporters noticed that the 6-foot, 5-inch Peper had trouble getting out of the low-slung concept.

But Camaro enthusiasts seem eager to buy any new Camaro.

Doug Warren, 53, is the owner of four classic Camaros and president of the West Michigan Camaro Owners Club in Grand Rapids. He drove his 2002 limited edition Camaro to the GM Tech Center for the big announcement.

"We love the new car," he said, standing next to wife Anita. "There is just something about these cars that touches people's inner souls."

The Associated Press contributed. You can reach Brett Clanton at (313) 222-2612 or

© Copyright 2006 The Detroit News. All rights reserved.

Saturday, August 12, 2006

Camaro to roar back by 2008

News bulletin
Camaro to roar back by 2008
GM to announce Chevy going from concept to streets
August 5, 2006

It's really happening: The Chevy Camaro is coming back as a production car, the Free Press has learned.

General Motors Corp. Chairman Rick Wagoner is expected to announce the resurrection of the legendary muscle car in a speech Thursday to an automotive conference in Traverse City.

The auto industry has been buzzing with speculation about GM's plans for the Camaro ever since the carmaker wowed the crowds at the 2006 North American International Auto Show in January with a stunning 400-horsepower concept. At a time when truck and SUV sales are softening and car sales are regaining momentum, a sexy new entry could give GM's entire passenger-car line a boost.

The production version could be built as early as 2008 and will offer three engines, a V-6 and two V-8s, according to people familiar with the plans.

GM spokesman Steve Harris would not comment Friday on plans for the Camaro, but other sources told the Free Press that GM's top management and board of directors have green-lighted the car.

The Camaro was introduced in 1966 as the answer to the Ford Mustang, and it prowled America's streets and drag strips until production ended in 2002.

Like the concept, the production Camaro will be based on GM's new Zeta global architecture for rear-wheel-drive cars, expected to form the basis for several big, powerful sedans and coupes to be introduced over the next few years.

It was unclear last week where GM intends to build the Camaro. Speculation in the automotive press has centered on assembly plants in Oshawa, Ontario, and Wilmington, Del.

Other unanswered questions are sure to keep the buzz going even after Wagoner's announcement:

How many people will buy a Camaro in the age of $3.15-per-gallon gasoline?

What will it cost?

And what about bringing back the Pontiac Firebird/TransAm?

Contact TOM WALSH at 313-223-4430 or

Copyright © 2006 Detroit Free Press Inc.

Friday, August 11, 2006

Apple announces partnership with Ford, GM, Mazda

Apple announces partnership with Ford, GM, Mazda

Apple today announced it has teamed up with Ford, General Motors and Mazda to deliver seamless iPod integration across the majority of their brands and models, making it easy for iPod users to listen to and control their iPod through their car’s stereo system. So-called "integration" is superior to a regular line-in or FM transmitter because it allows the driver to use the stereo controls on the steering wheel or dash to control the iPod (changing tracks, and so on). With the addition of these models, more than 70 percent of 2007-model U.S. automobiles will offer iPod integration. Notably, GM will make the technology available on all of its 56 vehicles.

"We're delighted that Ford, General Motors and Mazda will support iPod connectivity in nearly all of their new models," said Greg Joswiak, Apple’s vice president of Worldwide iPod Product Marketing. "Now more than 70 percent of 2007-model U.S. automobiles will offer iPod integration, with General Motors alone making it available on all 56 of its models, representing millions of cars and trucks."

Ford and General Motors will feature iPod integration in the majority of their 2007 models in the U.S. beginning later this year, while Mazda’s entire global 2007 lineup of cars and SUVs will offer iPod connectivity. iPod offerings for Ford, General Motors and Mazda provide drivers with outstanding sound quality while charging the iPod, while conveniently storing the iPod in the glove compartment. Seamless iPod integration also allows drivers to use their car’s multifunction controls to select their music using artist, album, playlist or shuffle songs, as well as to easily skip between tracks and playlists.

GM's "Personal Audio Link" in detail

GM has also released specific details on its integration package. The device, called "Personal Audio Link," will sell at GM dealerships for less than $160 at MSRP, plus installation. It will be introduced in October on 2006 and 2007 model year Chevrolet HHRs, already one of the industry's most personalized vehicles, with more GM vehicles scheduled to be added by the end of this year. Designed specifically for the iPod, GM expects to make the device available on all of its 56 vehicle models – mostly by the end of 2007 – meaning GM will offer the widest range of vehicle applications for iPod integration in the industry.

"We understand that people want to use their iPod whenever and wherever they want," said Mike Jackson, GM North America vice president, Marketing & Advertising. "We're thrilled to offer an awesome, seamless digital music experience to our customers across our entire portfolio of great cars and trucks."

Vehicle personalization is embedded in today's vehicle purchase and ownership experience. Nancy Philippart, executive director, GM Accessories, believes that iPod and GM vehicle personalization are a perfect fit.

"With our simple, affordable system, our customers can plug their iPod into their vehicle audio system and get what they want – clear, quality sound as well as access to playlists and artists' names," said Philippart. "Because the Personal Audio Link was designed specifically for GM vehicles, the level of integration our system offers is unmatched in the market."

The Personal Audio Link iPod adapter, about the size of a deck of cards and not visible to the customer once installed, uses existing radio software, and is integrated through the radio's digital XM Satellite Radio band. (XM does not need to be activated for the system to work.) This provides improved sound over FM modulated systems, and better control and display over FM modulated and CD changer interface units.

The system displays song artist, title and genre on the radio display, and allows song selection by genre, playlist, artist and album. In addition, Podcasts and audio books are no problem. Personal Audio Link enables the user to store, sort and select their favorite Podcast or audio book by title. In vehicles equipped with steering wheel audio controls, those controls will also control volume.

Once the device is installed, the customer plugs the iPod into an interface cable in the glove box, where the player can be safely secured and stowed. The device also charges the iPod while the vehicle is operating.

"We know our music-loving customers have been clamoring for a system like this, but we were determined not to go into the market with one unless it was truly integrated, easy to use and affordable," said Philippart. "I think this system will be music to our customers' ears."

Seamlessly connects an iPod to the vehicle's factory installed audio system

Charges iPod when ignition is on

Choose from English, Spanish or French language for function displays

Search and display music by genre, playlist, album, artist

Use seek function to move forward or reverse within a song for up to 15 seconds

Select "shuffle" function to mix music

Sort music using "alphabetical jump" from A-Z list

Sort and select Podcasts and audio books by title

Control volume from steering wheel controls

Personalize text display in dynamic mode (radio display scrolls through artist, album, title, song, time remaining, etc.) or static mode (fixed on one display element such as artist)

Perform fast music searches using high-speed text display technology

Ford's approach

For the 2007-model year, built-in auxiliary audio-input jacks will be offered on the Ford Edge, Explorer, Expedition, Mustang, Fusion, Sport Trac, Ranger, F-150, Mercury Milan, Mountaineer, Lincoln MKX, Lincoln MKZ, Navigator and Lincoln Mark LT. The jacks allow customers to bring any iPod or other MP3 player with a standard 3.5 millimeter audio output into their vehicle and play it through the audio system.

In addition, early next year, Ford and Lincoln Mercury dealers throughout the U.S. will begin offering Ford’s TripTunes Advanced audio system – an iPod integration feature that provides drivers with top sound quality and recharging at the same time. TripTunes Advanced allows the driver to store the iPod in the vehicle’s glove box and select music using the steering wheel or radio controls – including shuffling songs and skipping between tracks and playlists.

“The iPod has been a huge hit, and we at Ford wanted to develop a way for people to bring the device into their Ford, Lincoln or Mercury vehicle without having to fuss with the device while driving,” said Doug VanDagens, director of Ford’s product and business development for electronics. “What we’ve accomplished with the integration of the iPod into our vehicles is just one piece of a much broader effort at Ford Motor Company to respond to customer trends more quickly.”


The manufacturer's suggested retail price (MSRP) is JPY 23,100 (including installation fee and consumption tax) in Japan.

Connected by a special adaptor to the car audio system, music can be played without compromising the iPod's clear sound quality.

Owners can switch to the music menu, play songs at random and control the volume with the switches on the car's original, factory-installed Mazda audio system.

If the steering wheel has audio control switches, the driver can control the volume and select tunes without taking his or her hands off the wheel.

Once connected, the iPod is stowed securely in the glove compartment where it is charged.

Operation must be done through the audio system, not using the iPod. Track information, such as the artist or album name is not displayed on the audio system.
The adapter is compatible with the iPod models with a Dock connector including the third-generation iPod or later, iPod mini and iPod nano. It is not compatible with iPod shuffle.

Filed in "Mazda, General Motors, Ford",

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