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By John Neff
Sept. 21, 2007
Earlier this month, Toyota Executive Veep Kazuo Okamoto made news when he defended his company's pursuit of further developing its parallel hybrid system called the Hybrid Synergy Drive. He was specifically calling out GM's development of the first mass market series hybrid, the Chevy Volt. On Toyota's own Open Road Blog, Irv Miller, Group Vice President of Corporate Communications, came to the defense of his boss soon after. It was an editorial we missed at the time, but reading it this morning was an eye opener.
Miller makes a case for Toyota's support of parallel hybrids by saying that at this point the Volt is vaporware, while you can buy a Prius today. He notes that Volt engineers are only able to get about 10 miles of pure electric range from current lithium-ion batteries, far short of the 40 miles promised by GM. He also goes after the set up of a series hybrid, saying, "So – and we love this part - a series hybrid hauls around a gas engine that isn't available to directly propel the car."
There are no doubt engineers in this audience who will read Toyota's response and rip it to shreds, much like commenters have already done on the original post. We'll merely respond to two points, since we're not engineers. Toyota calling a series hybrid vaporware because there isn't one on the market today is bunk. We assume the Hybrid Synergy Drive was at one time in development, too. While there's certainly a chance the Volt may never happen (10% according to Bob Lutz), the fact that GM is already using the Volt in advertising and has been completely transparent with the car's development tells us that it will do whatever it takes to bring this car to market.
To actually question the efficiency of a series hybrid versus Toyota's parallel system also comes across a bit like sour grapes. While one can argue how clean a car really is that relies on the national grid for electricity, our measuring stick for the success of a green vehicle is how little gas it uses. Sure, it's simplistic, but it not only addresses the general greenness of a vehicle from the perspective of a consumer, but also how much money it will save its owner at the pump, as well how much it will reduce this nation's consumption of oil in general. Point blank, a series hybrid's gas engine (if it employs one) is really a generator, and it's optimized to run at a constant speed with a constant load. However much gas a series hybrid does use, its generator will use it much more efficiently than the engine in a parallel hybrid that has to be powerful enough to drive the wheels.
Aside from taking issue with Toyota's defense, we also read a lot of fear between the lines, a state in which we rarely ever see Toyota. Its reputation as environmental and technology leader is under attack from all sides, and GM of all companies is leading the charge. At the moment, no one doubts the dominance of the Prius and its capabilities, but before too long the green car market will change dramatically. Not only are we promised plug-ins, lithium-ion battery packs and a series hybrid, but new clean diesel engines will be along shortly and likely achieve similar if not better fuel economy in the U.S. than most parallel hybrids. That's because we like to travel on the highways of America more than in its cities where parallel-friendly stop and go driving is standard. Diesels are more efficient at cruising speed, more so in comparable applications than any gas/electric parallel hybrid on the market today. Frankly, we can't wait to see how all this goes down in the next few years, as surely the green conscience consumer will be the ultimate winner.
Well, GM the comapany would probably start to worry if it goes over a month. GM the people may start to worry a bit earlier wo a paycheck for 4 weeks. Their stock is now up 1% from 3% earlier. I wonder if the strike continues if GMs stock price will continue to rise?
If there is no one that wants Volvo for any reason, whether it be a money maker or loser or whatever it still is worth nothing.
All that Ford has said publicy is that they are "studying" selling Volvo.
Clearly, Volvo Cars has a value.
Whether or not a company that can afford to buy Volvo will buy them is secondary.
This is not a need driven sale.
This is just being done for equity purposes.
Clearly, Volvo Cars has a value.
Whether or not a company that can afford to buy Volvo will buy them is secondary.
This is not a need driven sale.
This is just being done for equity purposes.
I know this started with the Saab vs. Volvo and GM vs. Ford discussion. Bottom line is that Saab is not what it should be but at this time GM is not trying to sell it since they feel they can do something with it and have enough equity to not have to sell at either market rate or some bankruptcy sale price. Ford on the other hand is close to bankruptcy and needs the equity from any source they can get it from. If their other two companies do not get a good price (Jag/Land Rover) and Ford needs more cash they will sell Volvo if they can. It will be a need driven sale and most likely will go well below any kind of "book" value because there are few if any buyers. Maybe they could ebay Volvo? :P
You are correct, Volvo is a valuable asset and desirable to the right buyer. The more I think about it, Chrysler would be a good choice. Of course they have a slight problem in not having $8 billion dollars to buy another company.
Anyway, first your Lios lose to Philly (it was those uniforms; blinded and made the Lions sick) and now UAW striking:
UAW Strikes
Those Eagles Jersey's were indeed ugly but that's still no excuse to lose like they did. :mad:
-Rocky
A key point has been how much GM would contribute to what's called a Voluntary Employees Beneficiary Association, or VEBA, which the UAW would manage and use to pay its members' health care and retirement benefits. GM then could take that obligation off its books.
The UAW has argued that GM should put in 110% of the expected cost, while GM has been arguing for less than 100%.
62' I heard the VEBA, issue is settled. It boils down to job security and investment in the U.S.
-Rocky
This is really just a function of styling and reputation. As far as the better vehicle, well, I did consider the Matrix/Vibe for myself at one point, though admittedly not all that seriously. But my own take on it was that it did not have a great seating position. It seemed a bit low. Luckily, I am only a bit shorter than average, but I think if I were as short as, say 5 feet tall, then it might be a real problem. Also, though I did not try one on the street, everything I have heard and read about it is that the base engine is too weak, and the upper level engine power band is too high, and the handling is at best passable (and you can take that either way).
The article I quoted said that Toyota has found that it is selling to an older crowd than what they targeted. That is no surprise. The real "youth market" is not necessarily all street racers, but generally, young people do prefer a bit of response when you are trying to get moving. A vehicle is not just a fashion statement, especially when you are in the lower income bracket. I wonder though, which way the new Matrix/Vibe will go. Will they "fix" the performance and try again for the youth market, or will they decide to capitalize on the "old folks" market and make it more conservative?
I would like to find out how many Matrix have sold. Maybe there would be a way to get it from the insurance companies? They would know.
They were able to get some loans last year,so they aren't in imminent danger of bankruptcy.
GM cannot sell Saab. There is literally nothing to sell.
Saabs are re-bodied Opels and Chevy's right now.
Saab has no platform of their own to go and build a car with.
Even the Trollhatten plant isn't entirely theirs anymore.
Caddy builds the B class Euro Caddy there.
So, what is there to buy?
My numbers were for the US. The Canadian market very different, especially for compacts and smaller. I have no trouble believing that the locally-built Matrix could outsell the Mexican-import HHR up there.
I did not finish what I was writing before, and I cannot even remember some of what I wanted to say, but about the PT Cruiser styling: I have not seen all the various Chrysler products from the 30's but I agree that I have not seen anything by Chrysler that actually looked like the ancestor of the PT Cruiser. If anything, the PT Cruiser brought to mind the 1938 Chevy. So maybe it was the real HHR in the first place? :-)
I agree that Canada and US can have some big differences in the type of cars you drive. Anyway the biggest reason you see so many Matrix's vs. HHR is due to the fact that the HHR has only been around a couple years while the Matrix has been around about 8 years or so.
General Motors Corp., the largest U.S. automaker, will export $800 million worth of Buicks and auto parts to its joint venture in China over the next four years.
The exports, beginning in 2008, will include Buick Enclave sport-utility vehicles assembled in Lansing, Michigan, GM said today in announcing the agreement with Shanghai General Motors Co., its joint venture with Shanghai Automotive Co.
“No brand has been more important to Shanghai General Motors than our flagship brand Buick,'' Robert Socia, vice president of Shanghai GM, said in Washington. “In 1999, we sold fewer than 20,000 Buicks; last year, we sold 300,000 Buicks.''
China has taken on increased importance for GM as sales there grow amid a slump in the U.S. GM forecasts Chinese sales will rise at least 14 percent this year to more than 1 million vehicles. The automaker's China sales rose 6 percent for the quarter through June, while U.S. demand dropped 8 percent.
Today's agreement follows one in May under which GM will send $700 million of Cadillacs and components to China.
GM could export as many as 15,000 vehicles under the program announced today, company spokesman Greg Martin said in an interview.
It's not about who is bluffing anymore. It's about a survival and changing the business model. If you have $70/hr cost vs somebody's $40 and business model that's driven by supply (which means the product is build before and regardless of actual demand for it - hence heavy discounts are necessary to spur sales) - you got to lose. It may come now or later - depends how much cash you have to burn, but it's coming. A ten-year old child would understand it.
So why can't unions? It's simple - new business model would probably put their bosses out of business - so to keep their job (for now) they'd rather shut the company that's feeding them. At the end it actually is about survival - but it means a different thing for those two sides. GM (and actual workers in the factories) - it's about changing their cost and business model so they can sell product at profit. For UAW negotiation team it's about changing as little as possible (or nothing, if they could) so they keep their union paychecks coming and power intact.
So no, Rocky - they aren't bluffing. But they aren't really helping the employees, either.
2018 430i Gran Coupe
The bottom line is GM, wants to move production to low wage country's and the UAW, is fighting to keep those jobs here. There would of never been people in the jobs banks if GM, would of made cars people wanted to buy starting back in the 70's. The 80's was the killer and drove customers away from GM products. The 90's things improved slightly but Toyota, gained a sizable lead in R&D and it's going to take time to earn back those customers they lost.
-Rocky
GM has some where around $30 billion in cash in it's coffers.
It's not about who is bluffing anymore. It's about a survival and changing the business model. If you have $70/hr cost vs somebody's $40 and business model that's driven by supply (which means the product is build before and regardless of actual demand for it - hence heavy discounts are necessary to spur sales) - you got to lose. It may come now or later - depends how much cash you have to burn, but it's coming. A ten-year old child would understand it.
Well if GM, keeps making product improvements like the Enclave, they will regain market share once again. As one auto analyst said yesterday GM, can't bargain itself back market share, only good products that consumers want can do that for them. 62vetteefp, did you know back in 2005 that the UAW, talked about VEBA with GM, when the UAW opened up their contract for GM, and gave back health care concessions ? GM, didn't want any part of VEBA, back then. :confuse:
So why can't unions? It's simple - new business model would probably put their bosses out of business - so to keep their job (for now) they'd rather shut the company that's feeding them. At the end it actually is about survival - but it means a different thing for those two sides. GM (and actual workers in the factories) - it's about changing their cost and business model so they can sell product at profit. For UAW negotiation team it's about changing as little as possible (or nothing, if they could) so they keep their union paychecks coming and power intact.
So no, Rocky - they aren't bluffing. But they aren't really helping the employees, either.
The bottom line unless we implement real changes in the way we trade in this country it's a lost cause. The UAW workers might as well get what they can now because it's going over sea's or south of the border regardless of what the union gives them. The writing is on the wall.
-Rocky
Yes, and back then GM did not have the cash nor equity to make the kind of payments VEBA needed. They needed short term relief to keep them from bankruptcy, not another huge bill. They could barely keep the product development going on new products. They were spending lots of money on Engineering/development and tooling on the new trucks that were coming out. Not to mention all the other great products that have come out since then.
Finally something we can agree upon. However, product is where it merely starts. It needs to be followed by cost reduction and changes in business model. The production has to be more "portable", allowing them to switch models in the midyear to adjust for demand (so they don't get stuck with tons of super-V8 models in the middle of fuel cruch). But yes - it all starts with the product. I think they have too many dogs in their lineup and little will to cut them or improve. But how can they if all unions want is guaranteed production?
2018 430i Gran Coupe
I'm not going to let GM's current labor troubles sway me from their products. I only hope the strike is promptly and amicably settled.
GMC and Saturn divisions are ahead
Impala sales are up
Saab 9-5 is up
Cadillac trucks (Escalade, SRX) are up
Avalanche and Suburban are up
Yukan XL is up
Outlook brings Saturn trucks up
Isuzu has one up truck
The rest of the line is down
http://www.conceptcarz.com/vehicle/z2955/Toyota_Matrix/default.aspx
and this one?
http://www.motortrend.com/roadtests/wagon/112_0309_2002_toyota_matrix
Just can't discuss GM without mentioning Toyota. Toyota should really thank you GM fanboys for all the publicity.
In the end, think of it this way, it is actually a compliment to Toyota that the competition and its fans have taken such strong notice. Think back about thirty years and the idea of Toyota going head to head with GM for the sales race was laughable.
Toyota has earned their place at the top. Nobody in an internet forum will be able to downplay 30+ years of effort...
I think you are 100% wrong here.
Look at WHERE GM builds the vast majority of their cars.
US,Canada,Europe. All high wage countries with trained workers.
They aren't building cars in Bangladesh.
This strike isn't about an hourly rate,it is about all the benefits that go on top of that rate that makes GM uncompetitive in the current marketplace.
Honda, Toyota,Subaru, Mitusbishi, BMW, Mercedes all build cars here,and they pay competitive wages.
The advantage they have is they don't offer the ridiculous benefits that the UAW demands.
So, they CAN build cars in America and make it work. GM can too,if they can get the legacy and benefits costs under control.
As for "cars people wanted", GM and Ford have always done that.
The gas crunch was a small blip really.
What did the Big 3 in was shoddy build quality.
People saw how well foreign cars were assembled,and the fault there in a big way lies with the Unions.
They were turning out cars with bad panel fits,rattles, poor assembly, and getting paid very well to do it.
That's a bunch of bull ka-ka!!
And as you know, until it happens to you, you don't know how it feels to go through that crap-o-la!! I went through it with Exide (GNB Division) and there were tons of people that wanted (and still want) the execs heads on platters. Man am I glad to be outta that place
I am in the high tech business- no unions here (that I know of)- and our business was international 25 years ago already, with parts and assemblies and (now) software development sourced all over the world. And the ruthless competition in our business and constant product (and company!) obsolescence means that we eliminate maybe a million jobs a year- and create way more than a million jobs a year. To that extent, the U.S. is clear and away the world's leader in the world of high tech- every place else follows our lead. Can this work for GM or Ford or Chrysler? Or can the UAW accept globalization and survive?
In the arena of mass market cars,dealer experience counts for almost nothing. People will buy cars from bad dealers,period.
There are as many bad Honda and Toyota dealers as bad Ford and Chevy dealers.
Conversely, at the mass market level, people will not necessarily buy cars more from good dealers. Which is why Saturn,as good as their dealership experience usually is, cannot sell enough cars.
What matters most is either price(where the Koreans have the advantage) or the percpetion of superior quality(which is the japanese advantage)
given what it costs GM to design and build cars,they cannot compete w/ the koreans on cost,and cannot invest enough in their products to counter the quality issue with the japanese. They are literllay between a rock and a hard place.
Price is always a concern, but not paramount. I won't take crap from any dealer regardless of how cheap he sells me a car. A car's styling is extremely important to me thus it's unlikely I'd buy either a Japanese or Korean car on this aspect alone. European cars are very well styled but expensive for what you get, costly to maintain and repair, and have suspect reliability.
With GM I get the styling I desire, a decent price, usually a decent decent dealership, experience, and decent quality and reliability.
And not everyone eats at McDonalds or shops at Walmart either- in fact in the East Coast city where I live, Walmart hardly exists, but plenty of tony shopping malls and higher end individual stores do a great business.
But getting back to GM- they realize that they have to consolidate dealerships and go to the Toyota model. Tough- they still have lawsuits from former Oldsmobile dealers. But they need to do it.
Every time I shop at local Walmart, I swear I won't come again. And I do - not very often, but if the list gets long enough and I know the price will be lower than anywhere else, I close my nose and dive in. Then I swear I won't come back
2018 430i Gran Coupe
What quality issue with the Japanese. The JD Powers results and others indicate a trivial difference in problems in new cars. The difficulty is in getting some people's perceptions to change from the past; some insist on living in the past because it makes them feel better about their car choice.
2014 Malibu 2LT, 2015 Cruze 2LT,
You may be right, but too many people still think it's a real issue. Large portion of of my coworkers simply would not touch a domestic car. They would buy a truck, but you would not convince them Impala or Taurus are near Camry or Accord. Until they get convinced, the issue exists, even if it's all in the consumers' head.
GM "worked hard" for decades to lose the reputation, don't expect it to regain it just because you, Lemko, Rocky or Bob Lutz say their product is better. They have to see it and hear it from their friends, neighbors and coworkers - and not those who have always been for GM, but those who had Camry and switched to Malibu or Impala, had it for five years and would buy another one soon.
2018 430i Gran Coupe
First quarter: GM 30 / Hontoya 10
Second quarter: GM 0 / Hontoya 30 (too bad in basketball there are no negative points)
Third quarter: GM 25 / Hontoya 30
Since the game is on-going, how many points does GM need to out-score Hontoya in order to just TIE the ball game? If Hontoya scores 25 points in 4th quarter then it won't cut it for GM to score just 25 points. Again, GM has no one to blame except itself in second quarter so it's wise for them to shut up and be perfect in 4th so they'll have a chance in winning.
I tend to believe that this strike will only hasten the movement of production overseas. GM will only learn that the UAW still has no grip on reality and can't be expected to realistically adjust to market forces. The only option for GM will be to ship jobs to Asia to hedge against the influence of the UAW. We will see even more Korean GM products, complimented with Austrailian and European sourced models in NA. If I were Ford and Chrysler, I'd already be shopping around.
It may be hard to find a country without organized labor to build your cars, plus what you save may get eaten up in freight and currency issues.
Which is why bad dealers survive and prosper.
On average those import dealers are no better than the domestic ones.
If anything,they can be worse and get away with it because of the demand for their products.
As I said originally, it is the perception of quality.
Plus, it isn't about defects.
It is about style and features.
The domestics,esp the domestic sedans are lagging in this area. GM and Ford have to come up with products that blow away the japanese cars,not just match them.
THAT is how you change perceptions.
Sadly, that approach costs lots of $$$
2014 Malibu 2LT, 2015 Cruze 2LT,
Which is why bad dealers survive and prosper.
Actually he is not the exception. That is why there are lots of bad dealers.
Lump sum payments to current employees so GM can bring in new employees at lower wages
VEBA approved
No agreement on building new plants here or outside of US
Modified job banks
signing bonus