elcopone

Optimistic About Ford

Mad, most of the time I enjoy your comments, but this time I think you're a bit off. There is good reason why Toyota and GM will be slower to market and less fuel effiicient with their electric models. Two words for you... safety and reliability. If you take Hyundai as a history lesson you learn that they came to the US with unsafe and unreliable cars. As a result they have been spending the last 20 years trying to prove that their cars are safe and reliable. Despite independent proof their cars are indeed safer and more reliable then virtually everyone, they have yet to shed that image.

So before you start crowning some Chinese company as the next big thing, understand that they have yet to prove they have either safety standards that are required or the reliability that is demanded. Many smart companies have gone belly up trying overcome these two major hurtles before. Additionally, Toyota has not launched these products not because they have inferior technology, but because they understand that all it takes is one battery exploding to ruin a 50 year reputation. Besides, there are about 200-300 auto companies in China already competing on the same value proposition.

I'm just saying, lots of question marks there, and I'm not ready to anoint them just yet.


On Jun 30 01:45 PM Mad Hedge Fund Trader wrote:

> Yes, but will they be able to beat BYD? Like Paul Revere on his midnight
> ride, I feel a patriotic duty towarn you of the foreign invasion
> that is headed our way. No I’m nottalking about the British, but
> redcoats of a more Eastern origin. I’mreferring to the Chinese electric
> car company “Build Your Dreams” (seekingalpha.com/symbo...
> www.byd.com/company.php). CEO Wang Chuan-Fu, who Charlie Munger
> describes as a combination ofGeneral Electric’s (seekingalpha.com/symbo...)
> legendary manager, Jack Welch, and inventorThomas Edison, scraped
> up $300,000 from relatives to start a knock off cell phone battery
> company in Shenzen in 1995. He grew the company into a massive, vertically
> integrated conglomerate, employing 130,000workaholics at 11 factories,
> including those in Hungary, Romania, andIndia (interesting choices).
> BYD bought a defunct car company in 2003and re-engineered it to launch
> the $22,000 F3DM sedan last year, an old technology ferrous oxide
> based plug-in hybrid that gets 62 miles on a charge. General Motors
> (seekingalpha.com/symbo...) Volt and Toyota’s (seekingalpha.com/symbo...)
> plug in Prius,which won’t come out until next year, will only get
> 40 miles per chargeand cost more. All-electric models are coming
> out this year. WarrenBuffet was so impressed, he made a rare foreign
> investment last year,asking for a 25% stake and settling for 10%
> for $230 million. Wang, who has already earned himself a place on
> the Forbes 400 list, intends to build BYD into the world’s largest
> automaker, and quickly. Why do Ifeel like this war is over before
> the first shots were even fired?

Why I'd Avoid Toyota, The #1 Automaker in the U.S.

That's an utter and complete lie. Evidence please? Here, I have done your work for you...

www.snopes.com/rumors/...

web.archive.org/web/20...


On Jun 23 11:50 AM Richard/Babyface wrote:

> If Americans like driving Japanese cars so much, they should move
> there.I agree that the automakers did not do themselves any good
> building cars with problems, but it is time for ALL Americans to
> support american made products and companies.
> After 9/11, Gm,Chrysler and Ford donated $10 Million each to our
> cause. Honda, Toyota, Nissan, Mitsubishi and Suzuki donated a total
> of ZERO!
> If you want to support companies that are one sided towards their
> own,then buy imported products. I question your loyaltyas an American.

Why I'd Avoid Toyota, The #1 Automaker in the U.S.

"fearsome of competitors – government owned companies"

You're kidding right... The beuracratic, self-serving, special interest driven, US Gov. as a "fearsome competitor?"

And Jimmy I understand your point, however, there is a huge difference between partnering for success and outright ownership.

Why Ford Is a Goner

The one other point that will do Ford in is the fact that they have the most debt of any automaker at the moment. If it wasn't for them getting "lucky" by refinancing that debt right before the credit markets exploded, they would have been in the exact same situation as GM and Chrysler.

Ford: Will Mulally Be Able to Continue His Masterful Job?

Talking purely on product, Ford does seem to have momentum (very recently) and for that Mullay should be praised. Sure, he's had a product blunder here and there (See: Taurus, I mean 500, err I mean Taurus), but overall the lineup has been moving in the right direction.

As others point out though, the debt structure is not sustainable. It may have bought them some time but they still have a tremendous debt burden, too large a dealer body, large legacy costs, and a unionized work force. This all points to continued losses.

But again, talking purely product and marketing, he has done a good job for a "non car guy."

More on White House's Strong-Arming of Chrysler Hedge Fund Hold Outs

First, the only one here with even a morsal of sanity is Alfredo Martinez.

Second, the political bickering/name-calling... fingers between the Repubs and Dems is just sickening. As an Inde, both parties disgust me as I fell BOTH parties are now "Party First" with neither having any real altruistic motives. Both parties have been reduced to extremmely biased, whining, cry-babies with nothing real to say.

GM Forcing More than 1,000 Dealerships to Close

David is correct in that they will look to act on technicalities within the dealer franchise agreements. While I agree that they are fully within their rights, state franchise laws are the "greesiest" laws around. They favor the dealer tremendously. GM, Ford and Chrysler know this and is why they have never attempted to dramatically reduce their dealer network before (despite the obvious need). What will happen is the dealers who are shut down will sue GM. They will either battle in court or GM will probably end up paying them. State franchise laws are an absolute gold mine for lobbyists (and politicians) and one could look at these laws as a very clear example of just how corrupt our elected officials are.

Warning: U.S. Auto Crash Ahead

I agree that the Fiat deal is simply absurd. However, I'm not sure of this "crash" you speak of. Are you talking a crash of car sales, stock prices, and/or companies? It is not clear to me in your post.

I think a good argument can be made that after the short-term supplier chain disruption, the remaining OEM's could be looking at 5-25% of the US market share up for grabs. Long-term this is very positive for the remaining automakers.

Cars: What It Means to 'Buy American'

It pains me when people say that all "Foreign company profits leave the US". It's funny, you would think on a site like SA people would actually understand the stock market.

True the profits go back to the company's home country. However in this thing called the "stock market", companies pay these things called "dividends", to these other people called "shareholders". And guess what, they pay the dividend to shareholders regardless of where they call home. So if you are an american and want some of Toyota's profits, you can have some. Buy the stock and part of the profits actually do come back to you. Buy enough of the stock and it is no longer a foreign company.

Toyota Motors: A Fantastic Short if We Soon Retest Market Lows

While I think you may be right, in that shorting TM may be a good move, I totally disagree on how you come to that conclusion.

For me, the reason to short TM is due to the general economy and weakness in auto sales. To suggest that TM is going to lose business to the "lil 3" is absurd in the short-term. Don't forget that TM has already come down from their highs in the 130's. This is not a company on the brink of bankruptcy like the American counterparts. To compare the two in this fashion is laughable. TM is making the hard decisions and cutting costs faster than GM could even dream of. TM R&D budget still outpaces GM by 10:1.

You mention Prius sales slowing but forgot to mention that this is completely typical of any car leading up to a new version coming out. You do know that the all-new Prius is coming out in May, right? Which is why sales for the Prius has slowed.

Cash for Clunckers is very short-sighted and may provide a one-time boost. Ultimately this does not lead to a sustainable advantage.

In sum, you may be right about shorting TM, but to suggest that they warrent a single-digit price like the "little 3" is rediculous.

Five Reasons Not to Buy American Cars

Second, for all the "buy american" people out there, I'm assuming you also don't believe in free markets and capitalism as well. Oh wait, you do believe in that unless you have a self interest in the matter. Let me ask you, have you purchased a new TV lately? Did you buy American there? Why not? Do you own a watch? Did you buy American there too? The list goes on and on....

Fact of the matter is that most people buy the best product for them, period. This is clear by the 20-yr decline in American market share. GM assembles some cars in Mexico and Canada, while Honda and Toyota assemble some cars in the US. The parts from both come from all over the world. In today's global economy the lines between American and Not-American are so blurred that no matter how hard you try you are always supporting a foreign company in some way.

By the way, true the profits go back to the company's home country. However there is this thing called the stock market, where companies pay these things called dividends, to these people called shareholders. And yes, they pay the dividend to shareholders regardless of where they call home. So if you want some of Toyota's profits, you can have some. Even if you're a yankee.

Obama Gives Ultimatums to GM, Chrysler: Rick Wagoner to Resign

Juan Carlos - FYI, the Asians have been spending 5X the amount on R&D than GM has. They already have plug-ins being tested (unlike the Volt mirage). So I highly doubt your notion is correct. Stop trying to create fear through spin and lies. You have no clue.

I do not feel sorry for Wagoner one bit. He deserved this. He is a symbol of the Detroit arrogance and denial that lead us to this point. Wagoner was the one who thought hybrids were "not worth investing in". When customers complained about quality, he blamed the media. When customers complained about styling, he said that styling was the best around and blamed the consumer. When customers complained about fuel economy, he said come buy this Hummer. This pattern of ignoring what the customer is saying and denying the truth about their products, is the reason why they have had 20 years of market share declines. Wagoner made more trips to Washington over his tenure than he did to his own factories. What does that tell you. GM never had a comprehensive strategy, and it shows.

Goodbye Rick, thanks for nothing.

Chrysler and Fiat's Latest Tiff: Not Unexpected, Not Good

If the fiat deal goes though, I don't see why the US would even consider helping a Chrysler. Let's not forget that Daimler still owns 25% of Chrysler. With another 35% going to Fiat, that would make the foreign ownership stake 60%, which would mean it's not an American company. So the US would be subsidizing a foreign company.

I personally have said that if Cerebus wasn't willing to infuse capital that they have into Chrysler because it is too risky, why should the US taxpayer have to bare that risk?

Auto Manufacturing: What Does 'Buy American' Even Mean?

Great post. This is the reality we live in (well at least some of us). What's sad is that Ford and GM still don't get it. They continue to push marketing campaigns with taglines like "An American Revolution", "This is Our Country", etc... Basically telling the consumer to ignore quality, price, styling, technology, fuel efficiency and buy our cars because we are based in Detroit. What a sad value proposition. In fact, if you believe in the American staples of free markets and capitalism then buying an uncompetitive product just because it's "American" is actually very Un-American.

"This is ouuuuuuuuuurrrrrrrr country!"

Detroit: Please Bring Back the Stripped Car

It's not a matter of low-priced/high-priced or stripped/loaded for Detroit. It's simply a matter of putting out ANY model the consumer actually wants, is excited about, and wants to buy. A low-price model does nothing if the entire lineup still has the same old ugly styling, poor quality and plastic interiors.