WILL "OBAMA-UAW" MOTORS (GM) CREATE A TAXPAYER-FUNDED CHINESE BEACHHEAD?

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It was a screaming banner headline on the Drudge Report. “GOVERNMENT MOTORS: CHINESE-MADE CARS TO USA!"

At the same time that 3,000 hard-working American automobile dealers were about to get their pink-slips, General Motors advised that its federally-funded restructuring apparently includes importing thousands of small cars from poverty-wage developing countries, including the People’s Republic of China.

Predictably, the United Auto Workers union spokespersons went apoplectic.

The internationalist free-traders immediately rallied to “Government Motors” defense, as they are ideologically unable to ever see anything wrong with increasing Communist China’s predatory takeover of world manufacturing.

Wedging open the floodgates to the future dumping of Chinese cars in the U.S.A. may make short-tem sense to GM's green-eye-shade gang (who are desperately trying to figure someway a mess like "Government Motors" can earn a profit while complying with 35-40+ m.p.g. Corporate Average Fuel Economy Standards, "Cap and Trade" carbon taxes, EPA, OSHA, greedy unions, trial lawyer pirates, platinum health care plans and other costs of doing business in 21st Century America)

However, from a strictly political standpoint, it's unbelievably tone-deaf.

Moreover, it's somewhat speculative that Americans will immediately rush in to buy Chinese-made "Buicks" and "Chevrolets."

It does, however, lay the foundations for Chinese domination of the U.S. light vehicle market in 15-20 years, as GM teaches the CHI-COMS all about U.S. regulatory compliance and breaks down nationalist/political resistance to Chinese vehicles. A collaborator makes that process much easier. Once that happens, the Chinese will take advantage of the grossly undervalued yuan (based on purchasing power parity analysis) and virtual slave labor to blow everyone else out of the low and low-middle ends of the market.

What was it that Vladmir Ilyich Lenin said? . . . "The Capitalists will sell us the rope with which we will hang them." Apparently GM and the Democratic Obama Administration want to be in the "rope selling" business.

While U.A.W. complaining may extract a few concessions and some featherbedding, don’t look for anyone in the federal government to nip this threat in the bud. We’re simply too dependant upon CHI-COM purchases of U.S. debt and too beholden to multi- nationalist ideology.

Besides, if GM doesn’t do it, somebody else most assuredly will.

WILL FORD BE CRUSHED UNDER THE "OBAMA-UAW MOTORS" STEAMROLLER?

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Tom Lindmark at Seeking Alpha apparently thinks so:

Mullaly has to look down the road and see a GM and Chrysler waiting for him largely relieved of debt service and owned by an amalgamation of the same union with which he must negotiate and the federal government. Two parties with something to prove and limitless resources with which to prove it.

Make no mistake, the government will not allow GM to fall on its face. For better or worse the Obama administration has over-committed to the rescue of the industry and cannot produce less than its survival. Chrysler is and always will be an afterthought — if push comes to shove it can be folded into GM — but GM will succeed no matter the cost.

He goes on to conclude that Alan Mulally may end up nothing more than a "footnote."

While Ford's future success under "Mulallyism" is hardly assured, Lindmark probably places too much faith in the "limitless resources" of the Obama Administration and the U.A.W. "Government Motors" will not only be saddled with the taint of public ownership, it will also probably become a hidebound captive of bureaucracy. Instead of the freedom to pursue the not-so-free market, "Obama-UAW Motors" may be chasing after all sorts of politically-correct, imagined "markets."

Certainly, the U.A.W. will bargain for as big a slice of the pie as they can force under prevailing conditions. Nothing suggests that "Government Motors" will get much of a break.

Moreover, the "limitless resources" are actually limited by a host of partisan political concerns.

Ford does have cause for concern anytime they're faced with a publically-subsidized competitor. And Ford has a well-documented history of blowing big leads, offending potential customers, and snatching defeat from the jaws of victory. Ford should also be very concerned about GM and Chrysler's debt-stripping in bankruptcy.

But there's not one place on earth where "Socialist Motors" has beaten private competitors over the long run.

We shouldn't expect it this time either.

FOMOCO ENGINEERS "WHIP IT, WHIP IT GOOD" (With apologies to Devo)

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Calibrating the latest generation of airbags is a tough job . . . .

Ford's safety engineers also have concocted a clever test method using a multi-tailed, lead-tipped steel whip. They use it to repeatedly "pepper" the underbody area where side impact air bag sensors are located. Data collected from such tests is used to refine sensor calibrations as well.

Feel free to write your own punchlines . . . .

"DEMO-CAP" AND TRADE: BACK TO THE '70S (THE 1870S!)

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Regular readers of Truth With Speedzzter know that Speedzzter's predicted the power-grabbing anti-Carbon Dioxide madness gripping internationalist politicians threatens to destroy our automotive liberty and turn back the clock to the low-performance '70s.

Congressman Joe Barton's (R-TX) prediction is even more dire.

If the Democrats favored "climate change" bill, known to beltway insiders as "Waxman-Markey" passes, Barton opines that we'd be venturing back to the '70s alright . . . the 1870s! "[S]et the flux capacitor to 1875. That's the last time Americans' carbon emissions matched the goals set by the Waxman-Markey legislation."

[Y]ou can test drive Waxman-Markey by sailing down to Haiti, because current CO2 emissions are where Waxman-Markey wants America's to be in 2050. Radical environmentalists think such a CO2 level will be heaven on Earth, but the place that has actually achieved it is a nation swimming in bacterial and protozoal diarrhea, hepatitis A and E, typhoid fever, dengue fever and malaria, with 47 percent illiteracy and a life expectancy of 49 years.

And the predicted impacts on your personal use of energy are an 800-pound sack of "not good:"

Your electricity bill will increase by 77 percent to 129 percent. Filling up your gas tank will cost anywhere from 60 percent to 144 percent more. The cost of home heating oil and natural gas will nearly double.

These inflationary costs would be devastating to the automotive hobbies and grassroots motorsports. They would imperil Ford Motor Company's fragile plans for recovery and deepen the current automotive depression into a lengthy national depression.

"DEMO-CAP" and Trade (or perhaps OBAMA-CAP and trade) will also contract domestic production as more jobs are exported to "developing" countries like Communist China.

According to the National Association of Manufacturers, a cap-and-trade law will cost 3 million to 4 million net jobs lost. The Heritage Foundation puts it between 1.8 million and 5.3 million, and Charles Rivers Associates estimated it as high as 7 million. . . . [W]e can expect to start buying more Mexican cement, Chinese fertilizer and Indian steel.

Barton explains that with Waxman-Markey, "we are capping our economy and trading away our jobs."

Pushing Waxman-Markey are a potent and powerful mix of "true believers" in the Greenhouse Gas faith, quasi-scientific bureaucrats, developing country politicians who want an unfair advantage in international trade, and liberal internationalists who want the untold sums of money and power that a "carbon credits" auction system will generate. Of course the ultimate source of that "cap and trade" tax money is the end user . . . consumers like you.

There wasn't a lot of motorsports fun to be had in 1875. Returning to that era would destroy most if not all of our automotive liberties and the industries upon which they're based. Thinking motorists, racers and automotive business persons must vigorously oppose Waxman-Markey and all similar "Demo-Caps" on the free market for energy use.

LIKE WATER FOR VEBA (With apologies to Laura Esquivel)

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Ford Motor Company common shareholders, you're about to get a lot more company.

FoMoCo is offering of 300 million more shares of common stock (F). The new share will be used to partially fund its massive $6,300,000,000.00 year-end obligation to Ford's Voluntary Employee Beneficiary Association (VEBA), the U.A.W. retiree health care trust.

FoMoCo's total market capitalization is only around $14.5 billion.

Even though Ford is slicing the ownership pie a bit thinner with the new stock offering, the new shares stand to generate less than $2 billion of amount Ford has to turn over to VEBA this year. Shares of "F" would have to skyrocket to $21/share to cover $6.3 billion. That seems highly improbable in the short term.

Even at the pre-dilution announcement price level, the brokerage house Barclays claimed that "to justify the [then] current price level, Ford needs to generate a profit of $13 billion a year, which may not happen until 2012."

(Any profit by a U.S. automaker would seem miraculous nowadays.)

Truth With Speedzzter wonders what would happen if Ford had that money to invest in new product, rather than paying off the U.A.W.'s platinum benefit plans.

With numbers like that, don't be surprised if Ford is a big supporter of a "National Health Insurance" bailout. Call the future OBAMACare a "Mandatory Employee Beneficiary Association . . . ." (Of course, as with current federal spending, Obama's "MEBA" would be paid for with billions in borrowed money, potentially watering the value of the currency.)

IS THE SOUTHERN 500 A MICROCOSM OF MULALLY’S FORD?

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General Motors is careening toward bankruptcy faster than a napalm-covered snowball on a greased hillside.

But you couldn’t tell it Saturday night in Darlington.

The latest “renewal” of the Southern 500 proved to be another Appomattox for Ford’s FUNNYCar-of-Tomorrow Fusions.

To add insult to injury, former Roush-kat-teer Mark Martin glided a Hendrick “[W]Impala” to victory over a phalanx of Hendrick affiliated Chevrolets in the top seven positions.

Darlington is universally acknowledged as a drivers track – the “Lady in Black” and the “Track Too Tough To Tame.” So how did Ford’s yeoman group of drivers do?

Roush-Fenway ended up with a few haulers full of wrecks and only a couple of spots near the tail end of the top ten.

1. Roush-kat-teer Greg Biffle drove the best Ford to eighth. Although Biffle lead the most laps, a particularly vicious “Darlington Stripe,” pit strategy, and track position relegated him to also-ran status. He even finished behind rookie part-timer and Talladega demolition derby winner Brad Keselowski!

2. Matt Kenseth dropped from the front row to tenth in a forgettable drive.

3-4. David Ragan and Cousin Carl Edwards sufficiently partook in the record-setting Southern 500 caution-fest to end up (or shall we more properly say END DOWN) in the thirties. (This time, Cousin Carl didn’t need Keselowski’s help to finish towards the back)

5. Jamie McMurray finished as the last car on the lead lap in twenty-second.

The only other Fords were driven by Paul Menard (15th) and Bobby Labonte (18th).

Not so good.

Jay Hart opined “Not since Michael Jordan, Magic Johnson and Larry Bird donned the red, white and blue to humiliate the world on a basketball court in Barcelona has one team dominated its competition quite like Hendrick Motorsports is doing now.”

He could have easily have written the converse about Ford’s underfunded, undersized and undermanned NASCAR efforts.

Mark Martin virtually has said it: “When I go over to that shop, I feel like I’ve gone to NASA and they’re getting me prepared to go to the moon . . . Every detail is handled as if it’s the most important thing in our race. It’s just really, really cool. It’s quite an experience for me to get to be a part of it at this point in my career.”

The bitter pill for Ford Racing fans is that had Ford been able or willing to accommodate Martin’s now-forgotten desire for a part-time schedule in a competitive car, he might still be driving for the Blue Oval. On the other hand, few believe that if Martin were still driving for Roush-Fenway that he’d already have two victories in 2009.

At least Ford traitor Jeff Gordon didn’t win another Southern 500 to tie Ford-ex Cale Yarborough’s win record.

(Curiously, although Cale bookended his NASCAR career in Fords, his most notable years were in Junior Johnson’s Chevrolets – which, of course, were the direct result of Ford’s myopic abandonment of Holman-Moody, Cale, and Junior Johnson in the 1970s. However, Cale appeared in the Fox Television’s Southern 500 pre-race show wearing a Honda hat. So much for brand loyalty . . . .)

Speaking of Honda, open wheel racing wasn’t any better for Ford Racing fans this past weekend.

Although qualifying for the “Greatest Spectacle in Racing” – the Indianapolis 500 – is now so unimportant as to be relegated to some cable channel that is apparently available in about 1 of every 100 cable television homes, Ford has been gone from Indy so long that what happens there has no meaning. General Motors did, however, display a whole row of “official” Camaro pace cars. And every car in the “spectacle” will be powered by Honda. There will be a Ford or two in the parking lots.

The Spanish Grand Prix was another Brawn GP 1-2 finish. Ford has also been gone so long from F1 that few will remember that Ross Brawn found his initial success at Benneton-Ford. Incidentally, before Benneton-Ford, Brawn was first “discovered” by Jaguar -- back in the days when the mangy kitty contested international sports car events, such as the 24 Heurs Du Mans. Who knows what would have happened had Ford’s Racing bosses kept the brilliant Brawn applying his legendary skills to Fords?

The bottom line is that if success in racing is a matter of having the right people in the right places with the right resources, bankrupt Chevrolet (through Hendrick), Honda and upstart Brawn GP have each been doing a much better job of it.

On the business side, Ford continues to move with full force to convince everyone that Alan Mulally is the right person in the right place with the right resources.

The energetic Mulally, according to the latest Fortune puff-piece is a frenzied mass of color-coded, data-intensive, no Blackberry, no excuses, no cross-talk, 12-hours-a-day continuous action. His somewhat minimalist product strategy is apparently to concentrate on “One Ford” multinational platform sharing, deproliferation/simplification, “quality,” and profitability in smaller, value-added cars -- mostly powered by electricity or downsized EcoBoost engines. Given Ford’s continuing losses, this is probably about all anyone helming Ford could muster at the moment. Still, that Mulally’s managing it with an ever-present Mayberry grin and no Obama Car Czar Central Committee oversight during this great depression of light vehicle sales is no small accomplishment.

The Fortune article, of course, makes scant mention of the enthusiast side of FoMoCo. Readers are left wondering whether Mulally even has any meetings, charts, or color-coded reports on Mustang or Ford Racing. Like Robert McNamara fifty years ago, high-Performance is not one of Mulally’s index-carded core values. Nor is overt respect for Ford’s V8 and motorsports traditions. Nothing in his professional background indicates any understanding of this core constituency of Ford. After all, he drove a somnolent Lexus before he arrived in the Glass House. And he’s left virtually all of the public Ford Racing duties to board member Edsel B. Ford II.

Is Mulally even aware that Mustang has fallen significantly behind both Camaro and Challenger in the most important measures of street performance (even if only until the Coyote V8 comes on-line)? And if so, why would he let it happen on his watch when on-the-shelf supercharged alternatives could have prevented it? Will the Coyote V8 be given a chance to put Mustang back on top one last time before Corporate Average Fuel Economy regulations likely kill all the fun for a generation or more? Will there be an EcoBoost V8?

Does Mulally understand that V8s and RWD are essential to the Mustang heritage, or will he be seduced by the bean-counters and appliance motorist bureaucrats who almost saddled us with the hideous FWD MazdaProbeStang twenty years ago?

Does Mulally even have a plan to turn around Ford’s underperforming racing operations?

Does he have any appreciation of GM Performance Parts’ advantage in the repower market?

Does he understand the indispensable importance of a strong factory parts program and niche market specials in homologation of parts and engines for grassroots motorsports?

Is he aware of GM’s huge advantage in many forms of grassroots motorsports?

Does he have the right people in the right places with the right resources to compete in these critical, brand-sustaining, loyalty-building niches and programs?

Just like racing at Darlington, whether “Mulallyism” will work (and how well) depends a lot on forces beyond FoMoCo’s control. Will appliance motorist Americans pay more for value-added, European-quality small cars, or will they abandon American cars in increasing numbers for cheaper soulless Asian “commodity” sleds?

Will possible nationalization of GMAC give “Government Motors” and FIAT-Chrysler a huge advantage in financing?

Will the U.A.W.’s plea to “turn off lights in Tokyo and Seoul” end up in a trade war?

Will the $7,800,000,000.00 loss by the Evil Empire (Toyota) awaken them to a new round of brutal predatory moves?

Are we in for a “lost decade” of stagflation and constrained credit?

Will Ford’s bloated and greedy dealer network offset advances in product?

Has Ford’s failure to adequately tend the youth market for a generation written off millions of vehicle purchasers for a lifetime?

Will Ford’s myopic shilling for a “Cash for Clunkers” bailout alienate vintage vehicle collectors, hot rodders, and enthusiasts?

Will the import-centric automotive press give Ford’s new products a fair shake?

Are these outside forces “too tough to tame?”

It is alarming that according to some estimates, Ford only stands to gain one in every four sales lost by GM and Chrysler. Losing seventy-five percent of the “conquest” sales to the invaders is even worse than Ford’s disappointing record against the Hendrick Chevrolet juggernaut. It is emblematic of Ford’s decades of uncompetitiveness in certain market niches and the built-up brand capital of the predatory invaders.

Thus far, Mulally’s sold a lot of chair shuffling, reductions-in-force, and blue sky futurism. While thankfully Ford is not in as bad of shape as its crosstown rivals (much because of Mulally’s cash-conserving/mortgage-for-the-future instincts), it is not clear whether Ford’s next generation of value-added cars will reverse the flow of red ink.

However, if the current Mustang/Camaro/Challenger and Hendrick/Roush-Fenway battles are any indication, Ford still may not have learned how to throw a knockout punch. Or dominate. Or cross the finish line first when conditions are “too tough to tame.”