Archive for November, 2008

No Bailout

Thursday, November 20th, 2008

Apparently, the American government can fork over $700 billion of our money to Wall Street gamblers to pay for executive bonuses and meetings at luxury resorts, but it can’t spare $25 billion to tide over the big three automakers and save 3 million jobs. Why bail out one industry and let another drown? Could it be because Wall Street isn’t unionized? Is the government willing to let Chrysler, Ford and GM flounder because they’re hoping it will break the back of the United Auto Workers?

 

We’ve seen the figures showing that a union lineworker in Detroit makes over $70 an hour in income and benefits, while a non-union lineworker at a Nissan or BWM plant in Tennessee or Alabama makes about $25 an hour. Apparently we are all supposed to be outraged that union workers are “getting rich,” and by the same argument we’re all supposed to cheer lower wages for American workers paid by their Japanese and European employers. That attitude is more than a bit sick to me.

Collapse

Thursday, November 13th, 2008

There are a lot of things I wish I could write about this week, but with more and more headlines every day warning about the crash of the U.S. auto industry, nothing else seems to matter much.

 

A few weeks ago, when I was writing about the demise of Sterling Trucks, I asked what nameplate would be the next to go. We may have an answer to that: according to the news stories I’ve been reading all week, General Motors may cease to exist by the end of the year. Think about that: Chevrolet, Buick, Pontiac, GMC, Cadillac, Saab, Saturn, Hummer, Vauxhall, Opel and Holden could all go the way of the dodo. And if GM fails, what’s to stop Chrysler and Ford from failing as well? You can argue that that may be a good and fitting end to an industry that has willfully ignored reality since the first world oil crisis of the early ’70s, or you can argue that the federal government has no choice but to bail out Ford, Chrysler and GM. Personally, I can’t decide. I have no problem with punishing the corporations, the CEOs and the boards of directors for their greed and their abysmally poor business decisions, but I do have a problem with punishing their thousands of employees whose only crime was to want a fair wage for an honest day’s work.

 

Ultimately, I think the government will attempt to bail out the big three, not just out of sympathy to the auto industry but because if there are far fewer new cars being built and sold, then there will be far fewer cars being driven and demand for gasoline and diesel fuel will dry up, and the price of a barrel of oil will plummet. And we all know that can never be allowed to happen…

Urea So Vain

Thursday, November 6th, 2008

Last week I sat in on a webcast hosted by the Automotive Training Managers Council, in which Allen Johnson, Manager - After Sales Support EPA 2010 with Daimler Trucks, and Daryl Blandy, Senior Service Training Developer for Daimler Trucks, talked about what could be the biggest nightmare of everyone in the trucking industry: urea, or, if you prefer, diesel emission fluid (DEF).

 

There was a lot of information given on where the urea tanks will be located on Daimler’s 2010 trucks, how big those tanks will be, and in what size containers you’ll be able to purchase urea. We learned that the new fluid is a mixture of 32.5 percent urea in water, and that it is clear, odorless, non-toxic and biodegradable. We learned that urea weighs 9.2 pounds to the gallon, that it freezes at 12 degrees F and will therefore need to be heated in cold climates, and that it is corrosive to aluminum. We learned that urea will be available for purchase by November, 2009, in time for the 2010 engines.

 

We learned a lot about urea and how it will work. What we didn’t learn a lot about was its price. In fact, when someone listening in on the presentation asked about the price, there was a long silence on the phone line. Then someone said that urea is about 1/4 the cost of diesel fuel in Europe. Someone else guessed that urea would be $1.00 to $1.50 less per gallon than diesel fuel here in the U.S. But it was all speculation. Daimler’s speakers certainly didn’t want to be the ones to name a price, but I wish someone would have.

 

We journalists are used to engine OEMs referring questions of price increases to truck OEMs, saying “It’s really their call.” Well, Daimler is both an engine OEM and a truck OEM; why can’t they tell us what urea will cost?