Chrysler Early Clips Headlines (8

)

-- Chrysler Expedites 300 Sedan, Restyled Model Is Pushed Up to Improve Chances of Reaching 2010 Goal (The Wall Street Journal)
-- In new ads, Ram truck stands alone (Automotive News)
-- At Chrysler plant, the most flexible rules (Automotive News)
-- Chrysler shifts tone on dealers, Automaker offers reinstatement to 50 stores, signals settlement talks with more (Automotive News)
-- Fiat could launch hybrids, Marchionne says (Automotive News)
-- Ford Agrees to Sell Volvo to a Fast-Rising Chinese Company (The New York Times)
-- GM, dealers have fences yet to mend, Lawsuit continues; emotions still raw (Detroit Free Press)
-- How 'black boxes' help in car crash reconstructions (USA TODAY)

*Refer to © Notice Below
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The Wall Street Journal ( 03/29/2010 )
by Jeff Bennett

Chrysler Expedites 300 Sedan, Restyled Model Is Pushed Up to Improve Chances of Reaching 2010 Goal

Chrysler Group LLC is rushing to accelerate the U.S. launch of its redesigned flagship sedan, a once hot-selling model whose sales have slipped, as part of a push to keep on track its ambitious turnaround plan, said three people familiar with the matter.

The company is off to a sluggish start this quarter, and now needs a sales surge later this year to hit its target of selling 1.1 million vehicles in the U.S. When the car maker set the 2010 goal in November it predicted it would break even this year.

Chrysler, which is under the management control of Fiat SpA, will get help in May when a new version of its Jeep Grand Cherokee goes on sale at U.S. dealerships. The restyled version of one of the company's top-selling models features a more fuelefficient engine and a higher-quality interior.

In hopes of spurring sales later in the year, Chrysler also is making plans to move up the U.S. launch of the restyled Chrysler 300 sedan by three to four months, to November from the first quarter of 2011, these people said.

The new 300 model, as with the Jeep, features a sleeker exterior and a better grade of interior materials such as softer plastics, an area where Chrysler has come in for criticism.

The current 300, with a bold front grille and styling that some likened to a gangster car, was a hit when Chrysler started selling it in 2005. But sales have fallen in recent years. The car competes against Toyota Motor Corp.'s Avalon, General Motors Co.'s Buick Lucerne, Ford Motor Co.'s Taurus and other large sedans.

Chrysler also is working to raise production of the new six-cylinder engine that will debut in the reworked Grand Cherokee, these people said. Increased supply would enable Chrysler to offer the so-called Pentastar engine in other models this year, including the 300, they said. The engine could help win customers looking for a combination of power and fuel economy.

Chrysler is making the moves as it nears the one-year anniversary of its Chapter 11 bankruptcy filing on April 30. As part of a strategy worked out by the U.S. government, Chrysler formed an alliance with Italy's Fiat. In November, Sergio Marchionne, who serves as chief executive of both auto makers, outlined a turnaround plan that envisions Chrysler breaking even this year and generating profits in 2011.

The plan is based on a forecast that Chrysler's U.S. sales will rise 18% this year, from 931,402 cars and light trucks in 2009 to 1.1 million in 2010. But in the year's first two months, sales fell 3.2%, and analysts expect another decline when March sales are reported Thursday.

Chrysler sales this year through February fell to 141,592 vehicles, the lowest for the company in 30 years, according to Ward's Automotive Group.

To hit its target, Chrysler must now sell at least 95,000 vehicles per month for the rest of the year. It has reached that level only once in the last 14 months.

In addition, half or more of the vehicles Chrysler sold in January and February were purchased by rental-car companies and other fleet customers, said people familiar with the matter. That suggests Chrysler is having some trouble winning over individuals who buy cars through dealerships.

Mr. Marchionne's plan envisions such retail sales making up more than 70% of the total, and lower-margin fleet sales less than 30%.

Tom Stallkamp, a former senior Chrysler executive who is now a partner at Ripplewood Holdings LLC, a private-equity firm, said it will be hard for Chrysler to make up for sales it is losing out on now. "They are giving away their customers and you can't win them back later in the year, especially when you have more competition out there," he said, noting that Toyota, Honda Motor Co. and Hyundai Motor Co. are offering attractive incentives to gain market share.

A Chrysler spokesman, Gualberto Ranieri, said the company is sticking with its U.S. sales target. "The goal is for 1.1 million and Mr. Marchionne has never missed a target," he said. He declined to comment on Chrysler's financial situation. The company plans to report details on its fourth-quarter performance next month.

Mr. Stallkamp suggested Chrysler needs to be more aggressive marketing the models it has on its lots now, a strategy the company tried when it was struggling in the 1980s. "You can't go radio silent," he said. When I was there all we had was the K-car and we advertised the heck out of that and it bought us time until we had more product."

Last week the auto maker outlined a new advertising campaign plugging the heavy-duty Ram truck. The ads focus on the pickup's use at work and play and feature the voice of actor Sam Elliott, who stared in the move "Road House."

Under Mr. Marchionne's strategy, Chrysler eventually will launch a string of small cars based on Fiat models. But the first one won't arrive until late this year.

Dealers said they would welcome an early arrival of the revamped 300 sedan.

"I am selling a lot of Jeeps and Dodge trucks but not much else," said Alan Helfman vice president of River Oaks Chrysler Jeep Dodge in Houston. "We are holding tight until the summer and are awaiting the new Grand Cherokee and Chrysler 300."

(Copyright (c) 2007, Dow Jones & Company, Inc.)
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved.


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Automotive News ( 03/29/2010 )
by Brad Wernle

In new ads, Ram truck stands alone

DETROIT -- A new advertising campaign this spring for the 2010 Ram Heavy Duty pickup features the deep, resonant voice of actor Sam Elliott and celebrates the Dodge-like manly American pickup virtues of toughness, utility and durability.

But nowhere in the campaign is the word "Dodge" to be found.

That's just as Chrysler CEO Sergio Marchionne wants it. Marchionne is trying to rebuild Chrysler Group around strong brand identities. Last year he decreed that the Ram brand would be separate from Dodge in the same way Fiat and Fiat Professional are separate brands in Europe.

Marchionne said the change will give Dodge more room to establish an identity as a car, minivan and crossover brand while the Ram brand can increase its recreational and commercial truck business.

Skeptics have argued that Chrysler is weakening an icon by divorcing Dodge and the Ram pickup. American truck buyers long have chosen among Ford, Chevy and Dodge, they argue, and Chrysler is throwing away decades of brand equity.

Falling sales

Ram marketers have their work cut out for them. Ram brand sales dropped 31 percent in February compared with February 2009. The full-sized pickup segment rose 7 percent in February. Also, Chrysler is dialing back incentives that were as high as $3,000 per heavy-duty pickup a year ago. A $1,000 rebate is available through April on the heavy-duty Ram 2500.

The ad campaign was created by Ram's new agency, the Richards Group in Dallas. A central element will be the Ram HD's most prized honor: the 2010 Motor Trend magazine Truck of the Year award.

The Richards Group filmed five TV brand spots with the truck showing off its capabilities under heavy loads and in heavy weather.

Fred Diaz, CEO of the Ram brand and also Chrysler Group's lead sales executive, said, "We'll spend the lion's share on media and advertising and a minimum on incentives."

The Ram brand, which now includes the Ram and Dakota pickups and the discontinued Dodge Sprinter, accounts for about a third of all Chrysler Group shipments and revenues, he said. "It is a mainstay of the corporation, and we will not back down."

Marissa Hunter, head of communications for the Ram brand, said Ram wants to improve its heavy-duty share in areas in which it has been weak, such as pickups with gasoline engines, for example. Ram also plans to add nameplates, some fashioned from Fiats.

Road trip

In addition to TV and print ads and a new Web site, Ram marketers are taking their heavy-duty pickup to 33 venues.

Diaz said separating the brands gives Dodge "space to play."

Those buyers who still want to call their trucks Dodge can be proud to do so, Diaz said. "This Ram truck is always going to be a Dodge," he said. Each truck will carry a Dodge vehicle identification number.

"But you will never see it marketed as a Dodge Ram."

Read more: http://www.autonews.com/article/20100329/RETAIL03/303299951#ixzz0jYoxVlQ6

Copyright (C) 2007 Crain Communications, Inc. All rights reserved.
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved. 


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Automotive News ( 03/29/2010 )
by David Barkholz

At Chrysler plant, the most flexible rules

DETROIT -- Chrysler Group's new Pentastar V-6 engine plant in suburban Detroit has opened with some of the most flexible work rules among shops represented by the UAW.

When the plant is fully operational in October, most of its 500 UAW workers will spend at least part of their day in production, although 300 of those workers are skilled tradespeople, said Dan Haws, a shop steward for UAW Local 372 at the new Trenton South Engine Plant.

Haws knows of no other UAW plant where skilled trades workers are expected to run production daily. Traditionally, the UAW has insisted that production and skilled trades roles be kept separate to preserve jobs and ensure the safe repair and maintenance of machinery.

The rules will work at the plant, Haws said, because workers on each of two 10-hour shifts are broken into small teams responsible for producing and assembling parts on a specific group of machines. The trades workers will be responsible for running parts and maintaining and repairing machines as needed, Haws said after the plant's opening this month.

The $364 million Trenton South plant is producing a new generation of fuel-efficient V-6 engines that will replace seven older V-6s in the Chrysler fleet over the next two years.

Hourly assembly team leader Wesley Brooks said the skilled trades workers in each team are familiar with the machines, so they have a good feel for anticipating problems before they affect production. And when problems crop up, trades workers are on the spot to begin fixes, thus minimizing down time, Brooks said.

At the plant opening, Chrysler Group manufacturing chief Scott Garberding confirmed that many skilled trades workers will also run production. He declined to say how many.

Read more: http://www.autonews.com/article/20100329/OEM01/303299945#ixzz0jYoZYIPM

Copyright (C) 2007 Crain Communications, Inc. All rights reserved.
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved. 


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Automotive News ( 03/29/2010 )
by Neil Roland and Brad Wernle

Chrysler shifts tone on dealers, Automaker offers reinstatement to 50 stores, signals settlement talks with more

Finally, some movement at Chrysler.

After nearly a year of taking a hard line with rejected dealerships, Chrysler Group changed course last week and offered to reinstate 50 stores.

The company also said it will enter settlement talks with an unspecified number of rejected dealerships and disclosed that 36 already have been reinstated nationwide.

One thing hasn't changed, though. Chrysler still favors dealerships that sell all four of its brands: Chrysler, Dodge, Jeep and the recently added Ram truck brand. All 50 offers of reinstatement are to stores selling all those brands.

But despite the actions by Chrysler, problems remain.

Dealer lawyers say Chrysler hasn't budged in its approach to arbitration -- for example, demanding that arbitrating dealers sign confidentiality agreements blocking them from sharing Chrysler information with other dealers.

One dealer who received a call from a Chrysler official saying a letter of intent for reinstatement was coming said he was taking a wait-and-see attitude.

"We're looking at it with guarded optimism," said the dealer, who declined to be identified. He remains skeptical because Chrysler had given no previous indication it had any interest in bringing back any rejected dealerships.

A company spokesperson said Chrysler would continue to explore "mutually beneficial options outside arbitration" to settle with dealers who have filed for arbitration.

By offering to reinstate the 50, Chrysler reduced its arbitration caseload to 337, said a company spokesperson.

Ed Tonkin, chairman of the National Automobile Dealers Association, called Chrysler's intention to reinstate 50 dealerships "a move in the right direction." This, coupled with previous contracts awarded to 36 other closed dealerships, brings the total to 86 dealerships that could be reinstated.

In U.S. Bankruptcy Court last year, Chrysler canceled 789 dealerships.

"NADA views this as a good-faith effort and hopes that this carries forward in Chrysler's continuing settlement and arbitration discussions with the other terminated dealers," Tonkin said.

Delays?

Eric Chase, an attorney representing four rejected Chrysler dealers, said the reinstatements do not change his opinion that the automaker won't give in easily on the remaining dealerships seeking arbitration. He said Chrysler has been "obstructive" at every phase of the arbitration process.

Chrysler's demand for a signed confidentiality pledge before it will agree to provide documents in discovery is prompting complaints from dealer lawyers accustomed to comparing notes on strategy.

The company also still is resisting dealers' efforts to find out the specific criteria used in terminating their stores -- information that Chrysler was required under law to provide in January, dealer lawyers said.

"Chrysler continues to resist and contest each and every step in arbitration," said Rob Byerts, a Tallahassee, Fla., lawyer whose firm represents 13 closed Chrysler dealerships. "It appears to be for no good reason other than delay."

Delays benefit Chrysler because if arbitrations aren't completed before the June 14 deadline set by Congress, the dealers lose their cases, said Mike Charapp, a McLean, Va., lawyer.

Chrysler's nine-page "Confidentiality Agreement and Order" -- a copy of which Automotive News obtained -- has touched off wrangling in dozens of arbitrations, seven dealer lawyers said.

Chrysler defended the confidentiality agreement.

"This is a standard request in litigation dealing with sensitive financial and competitive data," the company said in an e-mail last week.

It added that the new law setting up arbitration states that "discovery shall be limited to request for documents specific to the covered dealership."

Dealer lawyers disagreed, saying the standard approach in arbitration is to consider each particular document rather than the documents as a whole.

If a document deals with trade secrets or confidential business information, then it is addressed with the arbitrator, they said. But dealership performance documents rarely raise such sensitive issues.

Hearings in April

Meanwhile, the June 14 deadline looms over proceedings, although arbitrators have the discretion to extend them another month.

A total of 115 hearing dates, scheduled from April 21 into early June, had been set as of last week, said India Johnson, senior vice president of the American Arbitration Association, which is administering the cases.

Hundreds more have yet to be scheduled. The exact figure is a shifting number, as General Motors Co. and perhaps Chrysler move to reinstate dealerships.

A total of 1,550 GM and Chrysler arbitration claims have been filed, but GM has said it is reinstating 661 rejected dealerships and is willing to discuss possible settlement with as many as 499 more.

Johnson has little concern about the arbitrations meeting the congressional deadline. Said Johnson: "We have a lot of other arbitrators that we could throw at these cases."

Chrysler Group reinstatements

Dealerships

789 - Canceled in bankruptcy in 2009

36 - Reinstated by Chrysler after bankruptcy

2,334 - Operating as of Feb. 28

50 - Will receive offers of reinstatement from Chrysler

337 - Still in arbitration

Source: Chrysler

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100329/RETAIL07/303299935/1400#ixzz0jYn7Tgi8

Copyright (C) 2007 Crain Communications, Inc. All rights reserved.
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved. 


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Automotive News ( 03/29/2010 )
by Luca Ciferri

Fiat could launch hybrids, Marchionne says

TURIN – Fiat S.p.A. CEO Sergio Marchionne said the automaker is considering selling hybrids in Europe. His comment adds weight to a remark by a local Italian politician that the company will soon launch minivans with a fuel-saving alternative powertrain.

Speaking at Fiat's annual shareholders meeting in Turin on Friday, Marchionne declined to elaborate further on hybrids, saying only that the company will announce its future products when it unveils its 2010-2014 business plan on April 21.

Earlier on Friday, Piedmont region governor Mercedes Bresso said Marchionne told her that Fiat will build hybrid variants of the five- and seven-seat minivans that will replace the Idea and Multipla models.

Bresso said the hybrid minivans would be built at the Mirafiori plant in Turin where Fiat has already said it will produce the new minivans with conventional engines starting in late 2011.

Automakers are launching gasoline- and diesel-electric hybrids as well as full-electric vehicles in Europe to meet a growing demand for fuel-efficient models and to help them comply with tougher EU regulations on fleet CO2 emissions that start to take effect in 2012.

Volkswagen has just introduced its first gasoline-electric hybrid powertrain, which is on the Touareg premium SUV. Next year, PSA/Peugeot Citroen will introduce diesel-electric hybrids starting with the 3008 medium minivan.

Fiat has not said whether it plans gasoline- or diesel-electric hybrids.

Fiat has had the lowest average fleet CO2 emissions of all companies selling cars in Europe for the past three years, according to UK-based market researched JATO Dynamics.

The automaker has focused on engine technology such as its Multiair variable valve timing system to boost fuel efficiency and lower CO2 output.

No Fiat electric car for Europe

Marchionne said it was very unlikely that Fiat will sell an electric version of its 500 minicar in Europe.

Chrysler Group said last week that it will sell an electric Fiat 500 in the United States starting in 2012.

Read more: http://www.autonews.com/article/20100329/ANE/100329905#ixzz0jYqOZIR1

Copyright (C) 2007 Crain Communications, Inc. All rights reserved.
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved. 


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The New York Times ( 03/29/2010 )
by Keith Bradsher

Ford Agrees to Sell Volvo to a Fast-Rising Chinese Company

HONG KONG — Ford Motor reached an agreement on Sunday to sell its Volvo subsidiary to a Chinese conglomerate, in the clearest confirmation yet of China’s global ambitions in the auto industry.

“The future road for Volvo Cars is now defined,” Maud Olofsson, the Swedish deputy prime minister, said on Sunday. “Regardless of who owns Volvo Cars, its brand will still be Swedish.”

The Zhejiang Geely Holding Group, based in Hangzhou, agreed to pay $1.8 billion for Volvo, with $1.6 billion in cash and the rest in a note payable to Ford.

Ford paid $6 billion in 1999 to acquire Volvo, leaving the company with a substantial loss on its investment. Ford has shifted its strategy to focus on its core brands and has already sold off other luxury brands, including Jaguar and Land Rover to the Tata Group of India for $2.3 billion a year ago.

The purchase of one of Europe’s most storied brands shows how China has emerged not just as the largest auto market by number of vehicles sold in the last year, but also as a country determined to capture market share around the globe.

Zhejiang Geely said it planned to retain production of Volvo cars in Sweden, but it is expected to build another factory for them in China, most likely near Beijing or Shanghai. Ford already builds small numbers of Volvos for the Chinese market at an assembly plant in Chongqing. Most of the vehicles built at that factory are Fords and Mazdas for sale in China.

China overtook the United States in 2009 as the world’s largest auto market in terms of the number of family vehicles sold. But the average car in China sold for $17,000 last year while the average price tag in the United States was close to $30,000, according to the consulting firm J. D. Power & Associates. So the American car market is still bigger by value than China’s.

Zhejiang Geely’s majority-owned automotive subsidiary, Geely Automobile Holdings, is China’s 12th-largest automaker based on production so far this year. But it is China’s second-largest automaker, after the BYD Group, that is not at least partly state-owned.

Michael Dunne, an independent auto analyst based in Bangkok, said that acquiring a well-known brand was the fastest way for a company like Geely Auto to move up from making affordable cars for the masses to building respected cars for the affluent.

“This is all about Geely’s efforts to bust out of the basement,” Mr. Dunne said. “Volvo happens to be available.”

Many automakers in China are loaded with ambition, but Geely Auto stands out even by Chinese standards. While making most of its money on inexpensive compacts and subcompacts, it has turned heads at auto shows with ambitious concept cars that look like Western sports cars and even Rolls-Royces.

Last fall, Ford said that Geely was the preferred bidder for Volvo, but there were a number of problems that needed to be overcome, including ones involving trade secrets, financing and the initial hostility of Swedish labor and political leaders. In late December, the two had settled on most of the details of a deal, but financing and government approvals remained to be completed.

The parent company has said repeatedly that it planned to keep Volvo as a separate unit from Geely Auto. The company promised again on Sunday to retain Volvo’s existing management, but according to people in the industry, the company had already hired several executives with international automotive experience to help it oversee the new subsidiary.

Zhejiang Geely is dominated by its founder, Li Shufu, the son of farmers from Taizhou, in southeastern China, who turned a small business building motorcycle parts there into one of China’s fastest-growing companies.

“I want to emphasize that Volvo is Volvo and Geely is Geely — Volvo will be run by Volvo management,” Mr. Li said on Sunday at a news conference in Goteborg, Sweden. “We are determined to preserve the distinct identity of the Volvo brand.”

Having been scared last year by the near collapse of Saab, Sweden has acquiesced to the sale of Volvo to the Chinese buyer.

“The future road for Volvo Cars is now defined,” said Maud Olofsson, the Swedish deputy prime minister and minister for enterprise and energy. “Regardless of who owns Volvo Cars, its brand will still be Swedish.”

The deal is scheduled to close in the third quarter of this year. In the 11 years that Ford has owned Volvo Cars, it has closely integrated the two companies’ designs, so that their cars now share many parts.

Lewis W. K. Booth, Ford’s chief financial officer, said Ford would continue to supply Geely with engines, stamped steel body parts and other components for a period of time that he did not specify.

Yale Zhang, the director of greater China vehicle forecasts for CSM Worldwide, an international consulting firm, said the acquisition would benefit Geely Auto’s image at home, because many Chinese were likely to take pride in the acquisition of such a famous brand by a Chinese company. But Zhejiang Geely may also face a difficult time in becoming a multinational concern, since it has focused mostly on its domestic market up to now.

“It will help Geely’s brand, that’s for sure,” Mr. Zhang said.“The challenges and the risks are equal to the opportunity.”

Zhejiang Geely owns 51 percent of Geely Automobile Holdings, which is publicly traded in Hong Kong. Zhejiang Geely also still owns the original motorcycle parts manufacturing operation, along with several technical institutes and a hotel complex in southern China.

In a letter to the Hong Kong stock exchange last summer, Geely Auto publicly assured its minority investors that it would not try to buy Volvo. Such a deal would have greatly increased its debt at a time when the automaker was already investing heavily to expand in the Chinese market.

Instead of making a bid for Volvo through Geely Auto, the privately held parent company made the deal. With its pledge to keep Geely Auto and Volvo as separate subsidiaries, Zhejiang Geely may have been trying to address possible concerns in Sweden about the sale of a national icon to a Chinese company.

Mr. Dunne predicted that the Chinese market for luxury cars would more than double in the coming years, to 650,000 in 2015, compared with 300,000 last year.

“There is room in China for a successful Volvo,” Mr. Dunne said. “But will Geely know how to make it go?”

(c) 2007 New York Times Company
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved.


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Detroit Free Press ( 03/29/2010 )
by Tim Higgins

GM, dealers have fences yet to mend, Lawsuit continues; emotions still raw

Though General Motors is trying to get past problems with dealers over proposed shutdowns as quickly as possible, Steve La Belle’s lawsuit filed in Massachusetts shows how complicated the process is for the Detroit automaker.

La Belle was one of the 1,160 GM dealerships to file for arbitration, to fight to keep from losing his Chevrolet franchise. In the meantime, GM allowed a dealer from a neighboring community to move into LaBelle’s sales area, according to the lawsuit filed in early March.

La Belle, whose dealership is in Bridgewater, Mass., a town about 45 minutes south of Bos­ton, is trying to get an injunction to keep that competitor from selling new GM vehicles until his arbitration is re­solved.

It’s a complicated situation inherited by Mark Reuss, who became GM president of North America in December, following a management shake-up that included Fritz Henderson resigning as CEO and Chairman Ed Whitacre assuming chief executive duties.

Reuss quickly signaled that improving relations with deal­ers was one of his top priorities. At the National Automobile Dealers Association’s annual meeting in February, he said he wanted to settle as ma­ny of the arbitration cases as possible outside of court.

A few weeks later, he announced that GM was offering 661 GM dealers the opportunity to be reinstated. The rest remain in arbitration and face a June 14 deadline that can be extended by 30 days. La Belle received one of those offers, according to court filings. Those records give new insight into what GM is asking of those dealers to stay, and La Belle’s response illustrates the raw emotions that remain.

“I’m extremely frustrated,” La Belle told the Free Press by telephone. “I think Mark Reuss is trying to right a lot of the wrongs. … I think a lot of the old regime that still is there is trying to defend the decisions they made.”

The rules: Repay and remodel

La Belle was promised $250,000 to wind down his dealership. But if he wants to stay as a GM dealer, he now must come up with a line of credit, present $400,000 in working capital and repay GM the $56,000 of the wind-down money he already received, according to court filings.

The letter said he won’t be able to order any new vehicles until all of the wind-down money has been repaid.

There also are requirements on what the store must look like. Furthermore, he must withdraw the arbitration claim by April 30.

“I’m not going to sign their letter of intent until they provide me with a customary and usual letter of intent,” he said. While declining to discuss the specifics of La Belle’s situation, Ryndee Carney, a GM spokeswoman, said the terms of his letter of intent were similar to those sent to the 661 dealers offered a chance at reinstatement. Some of the details would be tailored to each dealer’s situation.

Carney said La Belle’s lawsuit has “has little or nothing to do with the arbitration process.” But she agreed that the case illustrates the complicated nature of GM’s dealer arbitration process, especially given the variances in franchise laws among the states.

“This type of thing, in the best of times, is complicated,” she said. “That’s why it’s been so important for us to address each one of these cases individually.”

Offer gets mixed reception

Joe Godfrey, of Godfrey Chevrolet Buick in Cadillac, was one of those dealers, facing the loss of his Buick franchise until he received GM’s letter offering reinstatement.

“I’m very pleased. … My family goes way back with Buick,” he said.

Godfrey said he was required to return money that GM already had paid him to wind down the Buick franchise — he wasn’t losing his Chevy line.

“I’ve already sent them a check,” he said.

Furthermore, he said, GM gave him an extension on when he must update his facilities. “They’ve been reasonable,” Godfrey said. “They said, ‘Times are tough, your road is going to be torn up in front of you. You don’t have to do it this year.’ ” The decision to fight GM ov­er the dealer process was difficult for many, however.

Allan Rose, a small Buick-Pontiac-GMC dealer in Gloversville, N.Y., said he decided not to appeal the decision because of the cost of arbitration and troubles getting financing for inventory.

Plus, he figured if his dealership had won an appeal, he would be required to spend about $150,000 or more to up­date his facilities to meet new GM requirements.

“My gut is that I could have beat General Motors on this had it gone to arbitration,” he said. “But when you’re going to sell 45 or 50 cars a year, what the hell am I going to win?”

(c) Copyright 2007, Detroit Free Press. All Rights Reserved.
© 2007 Dow Jones Reuters Business Interactive LLC (trading as Factiva). All rights reserved.


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USA TODAY ( 03/29/2010 )
by Jayne O'Donnell

How 'black boxes' help in car crash reconstructions

When it comes to "black boxes" in cars, there's one thing everyone from regulators to automakers agrees upon: These onboard crash-data recorders have their limitations.

Even so, in alleged unintended-acceleration incidents, there may be no better way to try to figure out whether the car or the driver is to blame.

Prompted by Toyota's recalls and questions about whether they fully remedy possible runaways, the National Highway Traffic Safety Administration is considering whether to require so-called black boxes — officially "event data recorders" or EDRs — in every vehicle sold in the USA. It estimates that two-thirds of new cars now come with them; about 40% of the cars on the road have them.

These devices typically gather information in the event of a crash. The data — spanning from a few seconds before a crash to up to a few seconds after — include such information as speed, seat belt use, air bag deployment and (important in acceleration probes) brake and gas pedal positions. If the data show a driver had his or her foot on the brake but the car still accelerated into a crash, it could help verify that the car, not the driver, was to blame.

NHTSA said last week that data from a Prius' black box, as well as other data from its diagnostic systems, showed that a woman who careened into a stone wall in Harrison, N.Y., was pressing the accelerator, not the brakes, and that a car defect was not at fault.

The data can be wrong

While the information proved useful in that case, the limited data being collected by black boxes mean they can help only so much in accident probes, or crash "reconstruction." The data can also be wrong if the car is defective, since EDRs rely on the same electronics that could have caused the problems in the first place. But data from multiple points in the car likely won't all be wrong.

Most crash investigations still rely on factors such as skid marks and deformation of the vehicles in the crash. That's why Mukul Verma, a former safety expert at General Motors, believes black boxes should be required.

"Today's cars are complex mechatronic (mechanical and electronic) systems, but reconstruction methods are still all mechanical and treat the car as a mechanical system only," says Verma, a consultant and professor. "Mandatory EDRs offer a way of catching up with the modern automobile."

He says black boxes could be redesigned to capture "fault codes" — error codes that vehicle computers supply to help mechanics diagnose and fix your car — for little cost. That, he says, would make EDRs more useful in seeing if vehicle malfunctions caused a crash.

NHTSA regulations are being phased in

A NHTSA standard, due to start phasing in this fall and be in place in 2012, does not mandate black boxes, but requires automakers that install them to disclose it and requires certain data, including brake and throttle position.

The Alliance of Automobile Manufacturers, which represents all major automakers except Honda, has petitioned NHTSA to postpone the rule's effective date to September 2013 because economic conditions delayed vehicle redesigns. Alliance spokesman Wade Newton said the group likely would not oppose making EDRs mandatory if NHTSA keeps the same data requirements. "That way development can continue unfettered and uninterrupted," he says.

If NHTSA proposes making boxes mandatory, it is expected to add a requirement that the data and tools to read the data be generally available.

Toyota executives testifying before Congress were admonished for limited accessibility of its vehicles' EDR data. Only Toyota could read the system and, until recently, it had only one machine in the U.S. for doing so. Accident investigators complained they rarely could obtain the data.

Toyota says it will have upgraded the software that can interpret EDR data by the end of April. NHTSA will have four of the Toyota machines used to extract EDR data by that time, and 150 more will be available in North America, Toyota says. Once these additional units are available, Toyota says, it will provide owners with access to recorder data from their vehicles upon request.

Toyota President Akio Toyoda said last month that the company would "make more active use" of EDRs because "we have recognized that we should enhance our information-gathering capabilities" and it would improve quality.

Ford Motor, General Motors and Chrysler have, by contrast, made their black-box technology available so that Bosch Diagnostics can make and sell systems to analyze their data. Anyone with the system can read them, including independent investigators and attorneys.

The other two of the six largest automakers in the U.S. market, Honda and Nissan, are more restrictive.

Nissan says it makes data from its recorders available to vehicle owners, law enforcement and NHTSA, upon request. The black-box function is part of a system it calls Consult. The data, such as EDR post-crash information, as well as things like why a check-engine light is on, can be obtained using an access code. Each of the 1,150 Nissan and Infiniti U.S. dealerships has at least one Consult tool, says Nissan spokesman Colin Price.

Honda says it is protecting its owners. "Our stance has always been that EDR data belongs to the owner of the vehicle, and we will download it at their request — or to comply with a court order," says Honda's Chris Naughton.

Honda and Acura dealers can access portions of the data with their diagnostic tools, but detailed analysis of EDR data currently can be done by Honda's research and development staff, Naughton says. In states that require it, independent garages can buy the tools from Honda.

Since EDRs began to be used, privacy advocates and civil liberties groups have raised concerns about how such data would be made available and used. At least 12 states have laws restricting access to EDR data, says Jim Harris, a Port St. Lucie, Fla., accident recontructionist.

The more access to data the better

Harris favors requiring all vehicles to have black boxes with standardized access to the data. Harris, who owns Harris Technical Services, says it already is costly for police and private investigators to buy the gear needed to access the data in the Detroit makers' vehicles.

"Whatever the outcome of the present hot issue, electronic failures likely to affect safety will happen in the future," he says. "We need to have some way of investigating those that is more reliable than today's technology."

Click here to view supplemental graphics: http://www.usatoday.com/money/autos/2010-03-29-blackboxes29_ST_N.htm

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