Every Which Way But loose

This past weekend my trophy wife, Debbie, and I celebrated our 17^th anniversary. This was one of those rare times when we managed to get away, just the two of us, and to share an opportunity to rediscover romance. We visited beautiful Ashville, North Carolina where we stayed at the Inn on the Biltmore estate. Sunday night we took the candlelight tour of the Biltmore House and marveled at the extravagance and excesses enjoyed by the turn-of-the century, ultra rich Vanderbilt family. Later that evening we enjoyed a magnificent meal at the restaurant at the Inn, during which I took advantage of the opportunity to swirl a vintage cognac in the candlelit atmosphere. Still later that evening we returned to the room where I had iced down a bucket with a 1993 vintage Dom Perignon. (On sale at Costco) The music in my head was playing and I was humming “Tonight’s the Night” by Rod Stewart…and I wasn’t disappointed.  

In the morning we had to rush through an early breakfast because I had an 8:30 A.M. presentation for the managers’ annual forecast meeting at Hunter Chevrolet in Hendersonville, which is about 30 miles away. Back to reality!

 You know, a successful marriage takes a lot of work. It’s times like these that make the memories that get you through the storms. My wife and I are so different in so very many ways. We rarely agree on restaurants…I am sort of a buffet sort of guy (who woulda’ guessed?) My wife prefers “boutique” restaurants with specialty menus. Me, I like action movies…guy flicks…you know John Claude Van Damme, Arnold Schwartzenegger, Sylvester Stallone and John Wayne sort of stuff.  My wife Debbie, she likes Julia Roberts’ movies and Doctor Quinn reruns. Of course the only time you’d catch me watching Doctor Quinn, Medicine Woman was if there was a fight scene between Doctor Quinn and Steven Segall. I try to keep telling my wife that Xena, Warrior Princess is just some kind of stupid feminist cult myth. Chuck Norris would pound Xena into the ground like a tent peg.

 Oh well…anyway. I just had a memory flash about one of the greatest guy flicks ever made… Every Which Way But Loose starring Clint Eastwood. Now that was a real man’s movie. In the movie Clint played a character named Philo Beddoe who made his living traveling around the country getting in exhibition bare-knuckled street brawls for money. The pet orangutan (Clyde) was a little over-the-top but the rest of the plot was academy award material in my opinion. During the whole movie Philo (Clint) was looking for a match with Tank Murdock, the undisputed world street-fighting champion.  This was going to be Philo’s big payday. But…at the end of the movie…the big fight…Tank and Philo duking it out in a junkyard, late at night in the cars’ headlights, with several hundred spectators all betting and drinking. Clint (Philo) was winning bigtime. Tank was staggering, out on his feet. The people in the crowd were starting to make remarks about how Tank was washed up…a has-been. They were making fun of him. For just a moment you saw the look of horror and pity on Clint’s (Philo’s) face. One more punch would finish Tank off…he’d drop like a ton of bricks. His reputation was everything Tank lived for and Clint (Philo) couldn’t bring himself to destroy the man. In the end Clint (Philo) deliberately let his guard down and gave Tank Murdock a clean shot and allowed him to win the fight, knocking Clint out. Just when you thought he was going to deliver the final punch the damn movie turned into a morality play. Oh well.

 You know for the last five years I have been delivering rapid-fire unmerciful (well-deserved) body shots at Ford Motor Company commenting on the buffoonery that was being passed off as management vision…a goofy and disjointed marketing plan that could easily have emanated from the hallucinations of the hookah-smoking caterpillar in Wonderland. I watched Rewey, Trotman and Nasser’s disasters with my jaw dropping in disbelief. I was the first to point out this apparent ineptitude was reaching an explosive altitude and magnitude the industry has never before experienced. Fueled by arrogance and perceived dishonorable dark intentions, the catastrophe was inevitable and predictable. I described over and over again exactly what is happening today in great detail and clarity.  Like the Titanic steaming full speed ahead toward the iceberg…I screamed out in these pages begging them to change course. They say the Australian-Lebanese foreman on the wrecking crew earned $12 million last year.

 Still, looking to Bill Ford, Nick Scheele and “The Dream Team” to pull some rabbits out of the hat here. Unfortunately, it now appears to me the ship is still on course to collide with that damn iceberg. Did you read the interview with Bill Ford that appeared in Automotive News?

 Mary Connelly and Ed Lapham did a superb job. They hit young Prince William with tough journalistic questions and the answers were flaccid and disappointing. (To me anyway)

 One of the questions they asked Bill was…At one point Jac Nasser had a goal of overtaking General Motors as the largest automaker of the world. Is that your goal?

 To which Billy allegedly said...“No, it is not. I don't think size is important.” Did that strike you as funny as it hit me? Bill Ford says size doesn’t matter.

 According to the interview Bill Ford said he is hearing that a lot of the early dissatisfaction with Blue Oval has settled down. Dealers are making a lot of money with Blue Oval. And then he was quoted as saying “But I would say overall it is working quite well, and that is the feedback I am getting from most of our dealers.” When asked if he was considering abolishing it his answer was… “No, I am not.” 

 Knock-knock…Earth to Billy…Billy this is Ziegler…who in the Hell have you been talking to…on what planet? They are setting you up, surrounding you with “Yes Men” (Women). You’re starting to sound like Nasser.

 All of the Dealers I know despise Blue Oval Certification. It’s your biggest negative issue. Get out in the real world. Get away from Dearborn and Detroit and that handful of dealers in the inner circle. You are starting to spout the same old party line. In this interview you are talking about cost-cutting like its some new religion and Nick Scheele is the New Messiah. Ford has cut costs to the bone and beyond already. That is what got the company in this mess to start with. Trotman and Nasser started out with a Ford Motor Company that was building superior product and then went on a cost-cutting binge that dragged the quality down into the toilet with record recalls and safety issues. If you guys don’t wake up…and I mean wake up right now…Bob Lutz and company are going to kick your corporate ass. You don’t shrink and cost-cut your way into a profit more than once. You sell your way out of it. It’s the product Billy…Your dealers are begging for imaginative cars and trucks with great styling, technology and quality. You build great cars and trucks and I swear they will sell them. You don’t need this bogus, alleged customer satisfaction program, you need product the public will buy…and you need to win back the public after you and others stood by too long and allowed the last two regimes to cut the heart of your company. Your customers didn’t defect because of anything the dealers did…it was always the product. Billy, Ford Motor Company needs to accept responsibility. Your current business plan is more of the same repackaged and regurgitated crap that got Ford in trouble to start with. 

I doubt that P.T. Barnum ever met any of the board members at Ford Motor Company but he did point out that one was born every minute. Me personally, considering what you’re getting for your money, I really think you need to take a hard look at your relationship with any so-called research companies. Didn’t your predecessor CEOs formulate business plans based on alleged consumer research, consumer trends and future predictions? What was the result? Excuse me if I am mistaken here but didn’t some company’s alleged research initially support the Internet initiatives heavily as…dare I say it…the wave of the future? Did your company and others formulate billions of dollars of failed Internet initiatives based on forecasted trends and alleged consumer research that didn’t materialize?  Has any bogus research steered your company on the rocks. What I am asking Bill is has your company lost billions because somebody developed market strategies based on what was being passed off as research and future forecasting? 

Ford Motor Company…they’ve got no great product in the pipeline according to every analyst and researcher…why Hell even their pals at J.D. Power and Associates as well as Merrill Lynch released some research that seems to agree that Ford trails behind all or most of the other manufacturers in new product development and redesign. Commenting on Ford’s lack of new product Jeffrey McCracken of the Detroit Free Press wrote in November… “What's new at Ford? Apparently, not much.”

 I am watching Tank Murdock staggering and I haven’t got the heart to take another shot. There isn’t any joy in this.

 I was talking to my friend Earle Eldridge at USA Today last week and we were both laughing till tears ran down my face. (Which wasn’t cool because I was driving and holding a cell phone at the time) I was pointing out to Earle that Ford Motor Company held the dubious distinction of being sued by virtually everybody they know. They are already in the worst financial shape imaginable. Get this…these guys (gals) are being sued by their own dealers, they are being sued by consumers and customers, soon to be class-actions, and their own suppliers…they are even facing legal challenges from their own employees for blatant age discrimination, as well as union challenges, and still they choose to keep challenging the states dealer-protective franchise laws in courts coast-to-coast. Even though there is no doubt that the majority of dealers despise the two-tiered pricing ambush created by the sinister Blue Oval Certification which is thinly disguised as some kind of customer satisfaction initiative when, in fact, it’s actually a paranoia induced control mechanism that is an evil remnant of previous managements’ insecurity based on questionable (by me) research. (Just another opinion based on the fact the company is going down the toilet if they don’t do something fast) At the time of this writing (December 17^th) its still in force although, regardless of what Bill is saying now, I still predict they’ll come to their senses, hopefully before convention, and revise the program killing the 1.25% rebate and restoring the 1% they took away to fund it. That is the only honorable way out of this mess. Ford Dealers and Ford Motor Company need to heal these wounds and move on. There will never be trust as long as this program stands.

 You didn’t ask for it but you got it…Toyota. They say there is a strong possibility that Toyota may be coming out with a third brand aimed at young buyers in addition to Toyota and Lexus. Jim Press, executive vice president of Toyota Motor Sales U.S.A., is saying the company will make a final decision by Spring 2002. The project is called Genesis and it smells like Saturn to me. I received an email from Jim Press about two months ago when I wrote that there were rumblings about Toyota USA drifting toward one-price and interfering with the retail process in their dealerships. In that correspondence he vehemently denied that Toyota has hired any goofball notorious “One-Price” consultants. Well, the jury is still out here. A third brand with cheap cars aimed at the youth buyer…that sounds familiar. I am deliberately not going to comment until they roll it out but believe me, its coming. All of this crap they’re saying about “we’re still thinking about it” sounds so bogus. I have never seen a manufacturer or distributor start hinting about something when the decision wasn’t already set in concrete. It’s sort of like when Ford or General Motors say they are just conducting a little limited experiment.

 I like Jim Press and I like Toyota. You’ve rarely seen me directing any “Bad Ink” at them. Maybe that’s because, until now, there hasn’t been a reason. I still might have to tell some of my friends who own Toyota Dealerships and Lexus stores… I told you so.

Yawn…Man I wish the rumors about Chrysler Corporation being sold back to an American Company were true. Don’t you just wish General Electric would really step up and buy the company and bring it home?

 The headline reads…Daimler Focuses on Accelerating Cost-Cutting Plan at Chrysler. 

Bleeding red ink out of every artery…sales diving deeper into the toilet…now we see the top brass at Daimler Chrysler AG huddling in Stuttgart talking about more cost-cutting and more job cuts.

 Some unnamed Daimler Chrysler executive allegedly said…"If you
have a challenge on the sales side, you have to do something on the cost side." If I had said something that apparently utterly moronic I would also prefer to remain unnamed. (Opinion, maybe it just seems brain-dead and idiotic to me)

 In a related story (I love saying that journalistic stuff) did you see where the wall Street Journal types are now finally predicting that BMW is poised to topple Mercedes-Benz as the No. 2 luxury automobile brand in the United States? Who first said that in this column over a year and a half ago? You’re right…it was me.

 My friend Bill Koenig at Bloomberg News wrote a great article, which in part, attributes most of BMW sales increases on the incredibly successful X5 SUV. BMW’s sales increased 15% this year while Mercedes barely saw a full percentage point of sales increase. Lexus also showed a 9.1 percent sales increase still blowing away all competitors in the Luxury segment. Of course Lincoln and Cadillac haven’t dominated the segment since 1998 the last time Lincoln was on top of the category. Of course my slant on that is that Downsizing the Town car was stupid. (I meant to say extremely stupid)

I am standing on the sidelines cheering…Bob Lutz is a dynamo. The spirit at GM is generating sparks. The dealers are aboard and the momentum is contagious. With the exit of Ron Zarella a black cloud seems to have been lifted and morale is soaring under Lutz. Reminiscent of the fast-track product development machine he built at Chrysler back in the 90’s, he’s put Brand Management and other Zarella initiatives on the back burner. Designers and Engineers rule while bean counters and soap powder executives run for cover, cowering and cringing. This man is Godzilla. He said he’d put the Car Guys (Gals) in charge and he’s kept his word. Everything’s positive about new product and new directions. Personally I’d like to see more performance vehicles in the Chevy and Pontiac lines. Some of the wimpy product coming off the line in recent years makes real men want to puke. How about a new Sting Ray that is a cut above the average Vette? I’ve heard rumors that might happen. Wasn’t Lutz the guy who concepted the Viper?   One thing makes me just a twinge nervous when I read that both Gary Cowger and Bob Lutz have said in separate interviews that there is a major effort is underway to find ways to cut costs. Cowger appears to be targeting warranty expenses for immediate cost-cutting revisions. That would be an incredible mistake. This is no time to be screwing with dealers’ money.

 Speaking of New-Age Folk Heroes, this guy Carlos Ghosn has my attention. They even made a comic book hero out of the guy in Japan. Come to think of it he does look like one of those evil international genius-villains from James Bond movies. All kidding aside…you just gotta love this guy. His turnaround plan for Nissan is aggressive and solid. He went through that cost-cutting thing and I thought that maybe he was just another one of these clue-impaired bean-counter morons that seems to be infecting the industry recently like a bad virus. BUT…he just announced his new turnaround program called the Nissan Revival Plan 180.

This is so cool! Nissan Revival Plan 180 breaks down this way…

The number one stands for Nissan increasing sales by a million units next year.

The number eight stands for an 8% operating profit margin, which is world class at the top of the industry.

The number zero stands for zero debt.

Of course, I am writing this in December and I am really trying to figure out what new “Wave of the Future” nonsense will be born at the NADA convention in New Orleans. The dot-communists are history for the most part. Of course I just read another press release where AutoByTel is still issuing press releases claiming they’ll be profitable in the 4^th quarter. My take on that is who cares. At a buck-seventy a share or thereabouts…we’re talking penny stocks here. Now that the deal with General Motors is apparently off (in light of reported failure I think)…you people said you were going to be profitable in the third quarter (Didn’t happen did it?) and now that another former CEO, Mark Lorimer, has boogied. Now the new guy, Jeffery Schwartz is confirming the alleged guidance. I sort of think you guys (gals) at AutoByTel need to get a grip on yourselves. I think you’re still facing extinction. There will be no more General Motors artificial influx of revenue to support you in the foreseeable near future…and the manufacturers websites will only get stronger. AND finally…the Internet is still another major non-event. It’s a niche-market segment. Most regular people are never going to buy cars online…period. Sure a handful of normal people will buy a car online…not in any significant numbers. There is a distinct shortage of the Nerd demographic consumers that you need to propel this business plan.

Speaking of goofy non-events…some manufacturers are spending a lot of time and money chasing built-to-order cars. That is never…never ever… going to happen. More clue-impaired fools tampering with an industry they don’t understand.

Swirling a snifter of Remy XO now signaling the end of another article. The events I predicted months ago are coming into reality now. I think the dealers and the manufacturers are going to solidify relationships as trust is reestablished. 2002 will probably be difficult. This is the time that the winners and the losers will be clearly defined. By this time next year I can foresee a reemerging economy starting to build momentum into the spring of 2003. You know some of us have lived through wars and recessions in the past. The losers will hunker down and try to account themselves into a profit while the winners will aggressively attack the market and sell their way out of trouble. We may have to say good-bye to some weak sisters who thought they were competent dealers. All in all I have to ask myself the one question that is my moral guiding principle… “What Would Clint Do?”

More Food For Thought

Dealers are from Mars…Factory Guys (Gals) are from Venus.

That would be a great title for a book huh? Is it just me or does it seem to you that they just don’t get it? I read the Billy Ford interview in Auto Snooze with my mouth dropping open. Does he really believe what he was saying? Have they learned nothing? Nobody more than me wanted to see Bill take the reins to save the day. I was cheering loudly when he threw the Philistines out of the sacred halls in Dearborn. BUT now, he is saying virtually…identically…everything Nasser was saying. I am feeling some real pain here because the outcome is, once again, predictable. I see General Motors making a genuine effort at Dealer/Factory reconciliation and I see the momentum. Then we look at Ford and Daimler Chrysler still worming around commitments and cost-cutting instead of innovating. Hunkering down instead of selling.  Toyota and Honda are sitting pretty but I think there is a genuine possibility that we may see major miscalculations in marketing strategy from both major Japanese manufacturers. Even BMW lost the ball in the sun when they redesigned the 7 series. My opinion, that’s one over technologied, ugly son-of-a-bitch. Of course the Germans answer to that is that they know what the consumers want. Well, we’ll see. In all fairness the Pontiac Aztek is still the undisputed titleholder, followed closely by Ford Taurus. BUT, I repeat…I think the new BMW 7series is a world-class contender in the butt-ugly category. Hey, what a great idea I just had. Maybe I could start awarding trophies like some of those high-powered research firms.

Nissan is starting to capture the imagination again and the Koreans are doing all of the right things. Remember what I said…look for Hyundai and Kia to be world-class contenders in the not-so-far-distant future. Depending when you’re reading this…I hope I see you (saw you) at the convention. If you’re reading this before the convention, be sure to attend one of my NADA Breakout sessions. 

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