It's no dot-com, but Carl Icahn wants piece of GM
Corp. is about to have a major new shareholder in financier Carl Icahn, but at presstime it wasn't clear just how much of the company he was going to buy. The No. 1 automaker would say only that Mr. Icahn is buying at least $15 million worth of stock, but less than 15% of outstanding shares. A 15% share would cost him more than $5 billion. Mr. Icahn bristles at the "corporate raider" label he earned during the 1980s and '90s, but his motivation with GM appears to be clear: to drive up its weak stock price. How? Perhaps by pushing more aggressively for a shakeup of GM's assets, including a full spinoff of satellite gem Hughes Electronics. He also recently purchased a big chunk of supplier Federal-Mogul Corp., but so far he hasn't made waves at the supplier, at least publicly.
's Jason Vines: There's no word war with GM
Motor Co. and Corp. may be firing salvoes at each other, but "I wouldn't call it a war of words," Ford Vice President-Communications Jason H. Vines tells WAW. Mr. Vines was not available when Dave Smith's column went to press, but in late August he responds to the observation that the Big Two are slinging arrows in a brewing public relations battle. "If it comes to tit for tat," he says, "we're not going to get involved. Our focus is not on GM; it's to become even more customer-oriented, and we're getting better and better at it." He thinks some of GM's reactions to recent Ford announcements actually may have backfired. He describes GM's response to the Ford/Firestone tire recall as "a little cavalier" because GM's Firestones aren't comparable in terms of age, applications or volume. GM says it has had no problems with Firestone Wilderness tires.
DaimlerChrysler still likes plastics for ESX3
If DaimlerChrysler Corp. meets its goal of making the ESX3 affordable by '04, look for it in production by '07, says Thomas Moore, DC engineering technologies vice president. The innovative use of lightweight thermoplastic six years ago in the China Concept Vehicle was resurrected in the ESX concepts, the ESX3 being the latest. The original ESX in 1999 had a $60,000 consumer cost penalty over a conventional sedan. The ESX2 brought it down to $15,000, and the latest would add about $7,500 in cost. At some point, Mr. Moore says the company wants a production plastic vehicle for North America.
What a way to end a vacation
Reiner Emig, executive vice president-engineering at RobertCorp., returned recently to Detroit from a two-week vacation to his German homeland only to find that Northwest Airlines had misplaced his luggage. Mr. Emig turned 50, and close friends in Germany came to a humdinger of a party that ended only when Mr. Emig stood up at 4:30 a.m. and said he was too old to stay awake for sun-up. Anyway, his chums gave him a crateful of priceless gifts - beautiful paintings, models and sketches of his favorite cars - the Mercedes Gullwing, Ferraris, Porsches. He meticulously packed the gifts in an enormous crate and handed it off to the Northwest baggage handlers for safe delivery to Detroit. His second mistake was giving them a crate containing his wife's brand new German bicycle. The couple made it to Detroit; the crates didn't, at first. After a week of pulling out his hair, Mr. Emig was pleased to receive his precious cargo - battered, but with Northwest apologies.
Analysts: soft landing for big truck industry
Despite recent massive layoffs by big truckmakers - the latest made by Freightliner Corp. and Navistar International Corp. - analysts believe the industry won't follow the extreme cyclical trends of its past and will avoid a serious downturn after several consecutive record sales years. Analysts take solace in the strong economy, the use of just-in-time manufacturing and online ordering, which were in their infancy the last time big truck sales softened. A two-year streak of monthly sales increases vs. previous years was snapped in March. Sales bounced back in April but have declined three out of the past four months, including a 10.4% drop in July - the largest decrease in more than two years. More declines have been predicted. "It's safe to say (Freightliner sales) are going to be down about 15% (in 2000)," Freightliner Chief Executive Jim Hebe tells reporters. His company lays off 3,745 employees.
Man freezes in chamber;manager drowns
It appears that freak accidents have claimed the lives of two auto industry employees, including one on the job. Geoffrey Lazarecki, 30, was found frozen to death in a nitrogen-cooled, automotive testing chamber at Defiance Testing and Engineering Services Inc., in Troy, MI, in August. Coworkers found the 6-foot-3, 205-lb. Mr. Lazarecki on the floor of the chamber, behind an unlocked door. The unlocked door has raised questions about the man's death. Still, the Oakland County Medical Examiner's Office rules it as an accident. Meanwhile, Atsushi Sugiura, 38, an engineering manager at theTechnical Center in Ann Arbor, MI, drowned and his wife was missing after a canoeing accident Aug. 8 near Anchorage, Alaska, where the couple was vacationing. Mr. Sugiura, a resident of Japan, was on a three-year assignment with Toyota in the U.S.
DC achieves another minivan benchmark
The '01/Dodge minivan hit full production in five weeks, the fastest ramp-up for a total redesign in DaimlerChrysler history and a domestic industry benchmark. Full line speed (1,350 a day over three shifts) was achieved Aug. 25 at the Windsor Assembly Plant. It built 25,000 minivans during launch, saving $500 million in production costs and reducing model changeover time by 80%. DC avoided 65 days of lost time from the traditional 110-day launch, which adds up to 150,000 additional vehicles. Annual capacity is 370,000. Investment in flexible manufacturing equipment allowed the production of 300 prototypes on line prior to launch. It enabled workers to achieve quality figures early. The first minivans were ready for delivery after three weeks.
OK, the auto industry isn't THAT mature
It started out innocently enough. At the recent University of Michigan automotive conference in Traverse City, MI, moderator Dave Cole asks panelists what thoughts concern them most when they go to bed at night. Ford's Louise Goeser says she worries about being able to explain the significance of Six Sigma quality control. JATCO's Kenichi Sasaki says he worries about selling automatic transmissions to an industry increasingly interested in fuel-cell-powered cars. When ExxonMobil's Bill Innes gets his turn, he starts by saying, "I do go to bed excited every night." As the double entendre sinks in, the audience starts chuckling like a bunch of high-schoolers. Mr. Cole decides to have some fun and says to GM's Larry Burns: "What excites you before you go to bed at night?" An incorrigible jokester, Mr. Burns looks at Mr. Innes sitting next to him and says "Bill," and brings down the house. Walking out, Mr. Innes is overheard remarking to a friend, "Wait until my wife hears about this."
Supplier news briefs
Siemens AG groups its automotive operations into a separate business unit - a move that was necessary for the two-way acquisition of Germany's Atecs Mannesmann AG. Siemens and RobertGmbH are each contributing $5 billion in purchasing the Mannesmann automotive operations. European approval of the purchase could come this month. ... Bill Carroll, president of Dana Corp.'s Automotive Systems Group, declines to confirm rumors that Dana could produce a rolling chassis for a pickup truck to be produced by AG in Brazil. He says only that, "Volkswagen is a very, very good customer of ours." ... Teves supplies the AdvanceTrac stability control system for Lincoln LS and Ford Focus and now gets tapped to potentially fit the system on 2 million Ford pickups and sport/utility vehicles. Ford rolls out the system in fall '01 for the redesigned Explorer. ... Donnelly Corp. of Holland, MI, supplies General Motors Corp. with its Smart Release system to detect motion and body heat and automatically open the trunk. The system will be standard equipment on Chevy Impala and Monte Carlo.