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High
Noon
Another
stormy, windy, rainy, gray, ugly Sunday in
Atlanta…one of those lazy days where you just get up
and brush your teeth and then you just sort of lay
around the house all day watching television. Sort of
like that old Simon and Garfunkle song, "I got no
deeds to do, no promises to keep".
There
are a lot of things happening in the industry right
now and I definitely have some personal opinions and
spins that I’d like to share with the readers.
Sitting in the den wearing our baseball caps
backwards, my son, Zachary, and I are watching Turner
Television, The Super Station. "Man Stuff!"
Incredible!
What luck! One of the greatest movies of all time is
just starting…Here’s the gist of it…Frank Miller
has just got out of prison and he’s due to arrive in
Hadleyville on the noon train. Frank has vowed to kill
Marshal Kane and everyone else in Hadleyville who
helped send him to prison.
Got
the picture? The original (real) "High Noon"
starring Gary Cooper, now this is a real man’s
movie. We’ve got one guy, Marshal Will Kane,
standing up to some really bad guys (Lee Van Cleef and
Sheb Wooley just to name a few) while all of the
townsfolk are cowering safe behind their locked doors.
The entire movie was shot in high-contrast black and
white, in "real time" from beginning to end.
We’re living every moment as it was happening for
one hour and twenty-five minutes.
High
Noon
is a morality play…a movie that teaches honor and
bravery and standing up for what’s right in spite of
the odds. In one scene Lon Chaney jr. who plays Martin
Howe, the old retired sheriff, offers Kane some advice
as he tries to persuade him to get out of town before
it’s too late. Howe tells Kane, "The
public doesn’t give a damn about integrity. A town
that won’t defend itself deserves no help."
Even
Old Judge Mettrick says… "I’ve been a
judge many times, in many towns, and I hope to live to
be a judge again"…and then the stinking
coward mounts up and rides out of town leaving Kane
alone to face Miller and his gang. Even Kane’s new
Quaker wife seems to abandon him.
Well
folks, I don’t know about you but, personally, I can
relate to that. There’s a battle raging out there
and some of you are still cowering behind locked doors
while there are others of us who are out here in the
streets facing down the bad guys. Remember when Gary
Cooper went into the church and tried to enlist some
deputies and the townsfolk looked away and refused
him? In every scene of the movie there was a clock on
the wall in the background inching closer to the
showdown at "High Noon".
Although
they say they would like better relations with their
dealers, once again (still) Ford is still charging
full speed ahead, trying to bust the states franchise
laws that protect dealer rights. They have already
filed an appeal to last months ruling against them by
the U.S. District Court in Texas. Let’s face it,
they want the right to sell and finance cars directly
to the public. It’s that simple. When that happens,
the public and the dealers will be screwed. Count on
it.
Ford
and General Motors and "The Alliance" are
still trying to bust the new franchise legislation in
Arizona.
I
was reading an article about the GM Driversite
experiment in Houston recently. Remember that was the
deal last year where General Motors was allegedly
trying to sell "Certified Used Cars" and
even arrange financing through their "GMDriversite.com"
website? At the time I felt it was a thinly disguised
end run around Texas law. Of course the courts agreed
with me on that issue.
Well,
George DeMontrand, DeMontrand Enterprises, Inc.
allegedly bought the store in Houston and went ahead
with the project sort of on behalf of General Motors.
Evidently, the results are in. The article I read
quoted Roy Pikus, GM’s Certified Used Vehicle Brand
Director, as saying that the Driversite experiment is
successful. "Two-thirds of the people who test
drive one, buy one." He was referring to the
people who inquire on the web and then come into the
dealership. The article went on to say they were
selling an average of thirty units a month. Stop the
presses! You’ve got to be kidding? Did they say they
were only selling 30 units a month? …In Houston,
Texas? If two-thirds of the people who drove one
bought one, that means they are only getting 45 ups a
month that drive? Is my math right here? We all know
how much money they have stuffed down the rat hole on
this goofy plan since it’s inception…They even
went to court against the state of Texas…all of this
just to get 30 stinking low-gross deals a month…in
Houston which is one of the greatest car markets in
the known universe. General Motors is calling this a
success? Quit it!
In
a conversation with one of Ford’s vice presidents
back in July, I told him that there is nothing that I
would like more than to be able to write something
positive about Ford. It doesn’t give me a lot of
pleasure to keep focusing on them this way in my
articles. The problem is that they are repeatedly
doing such despicable things to their dealers. As I
told the Ford Vice-President … "It’s
all about trust, and the truth of the matter is that
you (Ford) haven’t demonstrated that your dealers
can trust you."
If
"Blue Oval Certification" was really all
about customer satisfaction then what’s this
"Tire Thing" all about?
Watching
television late at night I was chuckling to myself as
I was watching Joe Pesci doing a bad impersonation of
Crocodile Dundee…Wait a second! That’s not Joe
Pesci…that’s Jac Nasser, president and CEO of Ford
Motor Company!
Sure,
I’ve seen pictures of him in Auto Snooze but I have
never actually heard his voice until now. I guess once
you get used to it that his accent is not really all
that obnoxious. I have to admit, it wasn’t what I
was expecting.
Truthfully,
all humor aside, there’s that monster ego, exuding
clouds of arrogance, forsaking good judgment and
common sense. It should have been William Clay Ford
out front saying those words "There are two
things we (Ford) never take lightly, your safety and
your trust."
Well
Jac, I’ve got to say this about that, you better be
right. I am not the only one who is not totally
convinced that you are telling the truth. And, I am
not the only one who says that you are 100%
responsible. There are a lot of people out there who
frankly just don’t believe you.
State
Farm insurance says that it alerted Firestone about 21
accidents they attributed to the tires back in 1997.
They also say they alerted the National Highway
Transportation Safety Administration about the problem
in 1998.
The
Venezuelan government is threatening criminal action
against Ford and Firestone for recalls of the same
tires manufactured in Valencia dating back to 1998. At
the time they claim that Ford and Firestone agreed to
insert components that had been left out into the new
tires but, in fact, that they only relabeled the old
tires indicating the these tires included the fix,
when, in fact; they were still the same tires just
relabeled. There appears to be something rotten in the
state of Denmark (or in this case, the city of
Dearborn)…something certainly smells like a rat here
doesn’t it?
Let’s
ask a simple question here. Did they or did they not
have similar problems and fatalities and injuries
involving the very same type of defects with Firestone
tires on Fords in Venezuela and elsewhere dating back
to 1998 and maybe even earlier? Yes or no?
According
to a recent survey by the Dohring Company, which I
believe to be a reputable research firm, (as opposed
to some that I suspect to be disreputable firms)
nearly half of the consumers in the sample rated
Ford’s honesty on this matter as "fair" to
"poor".
The
real question here is… "Did Ford Motor Company
continue to build and sell cars for months, even
years, after they knew the tires were defective and
were allegedly killing their customers?" When did
they start recalling tires in other countries? How
long have they been settling lawsuits based on these
tires? There are some responsible industry insiders
who suspect a longer-running deliberate cover up,
perhaps even a concealment of the situation, by Ford
and by Bridgestone/Firestone while they continued to
sell defective product that allegedly killed some of
their customers.
With
more than 193 accidents, more than 100 lawsuits, 88
fatalities, national class actions being contemplated,
and more than 6.5 million defective tires recalled to
date; I have a severe difficulty believing that this
problem just popped up on their radar screen suddenly
last month. Estimates put the recall at 350 million
dollars; not counting anticipated legal actions and
settlements.
An
article in the Washington Post says that the Center
for Auto Safety, a public-interest group, filed suit
against the automaker and Bridgestone/Firestone
seeking an expansion of the tire recall. The Center
for Auto Safety and other groups apparently believe
that there are other types of defective Firestone
tires that should be recalled as well. The article
went on to point out that the lawsuit filed by the
Center For Auto Safety might pry loose the answers to
some of these questions. Under evidentiary discovery
procedures they could get access to some internal
corporate documents that Ford has managed to keep
confidential under the terms of settlement agreements
in recent wrongful death and injury lawsuits.
It
appears that there are going to be Congressional
inquiries and hearings as well. House Commerce
Committee investigators are all over Ford's
headquarters at the end of August. Senator John McCain
is a bulldog and I am sure he won’t rest until we
get to the bottom of all of this.
Between
you and me, I’m getting a little sick of hearing
about the tires. It’s hard to believe that some
people will be waiting more than a year for
replacements with their lives in danger every day.
Some of these tires allegedly separated with less than
two thousand miles on them.
What
it all boils down to is who knew what…when…and why
they did or did not take action. Was there a cover up
and did they knowingly sell Explorers to consumers
with a potentially fatal defective part? When you buy
a Ford product, everything on that car is Ford’s
responsibility. If the answers are not acceptable,
maybe we will be saying "G’day" to our
little buddy from Down Under.
If
you’ve been following this column, you know that I
have been predicting this for some time now.
"Jac
the Knife" has squeezed the suppliers to the
bone…I believe he’s pushed too far and I’ve said
so repeatedly in issue after issue. Quality has
suffered and the lives of Ford’s customers have been
put at risk. Ford Motor Company’s motto may have to
be changed to "Quality Used To Be Job One".
With so many millions of cars recalled for major
safety and quality problems, it is obvious to me that
this is the effect of Nasser’s cost cutting and
squeezing the suppliers to take short cuts. Ford
Dealers have a right to be indignant at a company who
is trying to penalize financially them for customer
satisfaction issues when the quality of their product
is diving deeper into the dumper every day. Is
Firestone just another supplier who took shortcuts
trying to survive the tyranny of "Jac the
Knife"?
I
made up a timeline equation. It goes like this…Jac
Nasser cost cutting equals squeezing the
suppliers…equals poor quality parts and
assemblies…equals poor quality cars and
trucks…equals numerous product holds and recalls for
safety and quality…equals unsafe tire
scandals…equals crappy customer
satisfaction…equals bad Blue Oval scores for their
dealers…equals dealers lose money…equals customers
defect to other manufacturers cars…equals GM and
Chrysler take away market share…equals Ford Motor
Company stock goes into the toilet and stays there
under Nasser regime…Ford family and the board
finally get pissed off enough to kick the Little
Bugger out.
Of
course, that’s just a fantasy and my personal
opinion. Let’s see if history bears me out and my
equation comes true?
I
wonder if any of this was in the background of those
obviously unfounded rumors that Billy was trying to
take a poke at the little bugger.
Shifting
gears for a moment here, did you see where General
Motors has committed to have made-to-order vehicles
with exact specifications, from the initial order to
the consumer in a matter of a few days by 2003? The
reasoning is to reduce inventories. Just another
incredibly asinine, incompetent, moronic idea brought
to you by the same people whose is picture is in the
dictionary right next to several of those words. They
haven’t a clue. Consumers buy cars they can see and
touch and take with them…right now. Dealers with a
great selection of inventory on the ground sell more
cars. Reducing inventory is just another example of
the thinking that put General Motors in the toilet in
the first place. Aren’t these the people who gave us
VOMS? This is the same dysfunctional mentality that
still thinks Saturn is a success right after they just
had to pour another 1.5 billion dollars into that
black hole.
Did
you hear the music? Remember the movie
"Jaws"? Every time the shark was about to
eat somebody you’d hear the shark music. Well, I
just heard the music signaling that corporate raider
Carl Ichan is circling around General Motors. With
General Motors’ stock off more than 23% since April,
it’s corporate market value at perilous lows
approaching $38 billion in light of it’s incredibly
inept marketing strategy (See: Marketing Czar), I have
repeatedly pointed out that GM is ripe for hostile
takeover. Well, it seems that Ichan is firing a couple
of warning shots over the bow so-to-speak announcing
his intentions to acquire stock.
In
my last several articles, beginning in May, I pointed
out that Daimler-Chrysler was entering an era that I
call the "Age of Constipation". Sure enough
sport fans; those wacky Germans are bleeding money out
of every artery with U.S. sales of Minivans declining.
And now, it appears that Jeep sales have dived solidly
into the old crapper too. So Whadda Ya do about it?
You start cutting costs of course. Juergen Schrempp
announced that Daimler-Chrysler would boost profits by
cost-cutting measures totaling more than $5.5 Billion
over the next three years. Believe me, they’ve
already started and it isn’t going to be pretty.
Right
now, as I write these words, Daimler-Chrysler market
capitalization is worth less than Daimler Benz was
worth by itself before they acquired Chrysler back in
1998. And now, they are going to account themselves
down into a more profitable stance. I don’t think
so. By the way, if you are looking for an enlightened
snapshot of what really happened during the merger,
you need to read "Taken for a Ride: How
Daimler-Benz Rode off with Chrysler" by Bill
Vlasic, et al. It is available on Amazon.com for
$20.00. The Amazon.com rating on the book was four and
one-half stars out of five possible.
I
especially liked the story about the wild parties
where all the Germans apparently got snockered and
where Schrempp (married) allegedly tossed his
secretary (unmarried?) over his shoulder caveman style
and headed for the room. Eaton and his Boy Scout troop
were evidently shocked, overwhelmed, outgunned,
outmaneuvered and duped if you are to believe this
believable book. According to the tone of the book,
this was a large German victory.
Speaking
of Amazon.com, I was just cruising around the Internet
and I bumped into this headline which I copied right
off of the front page of the Amazon.com website.
Honk
If You Love New Cars!
We've partnered with Greenlight.com to take the
hassle out of new-car shopping. Stop by New
Cars, where you can browse thousands of
models without leaving the comfort of your chair.
That’s
right; Amazon.com and Greenlight.com have teamed up to
sell cars over the Internet. Now, you got to remember
that Ford and General Motors have warned dealers that
this is brokering. They threatened to take away all
incentives and bonuses as well as unit credits and
turn and earn.
If
you read my July article, "Facing the
Brute", you’ll remember that I predicted a
showdown between the dot-communists and the
manufacturers. Looks like it is coming to a head here.
Many of the largest dealers and dealer groups are
doing business openly with these alleged brokers in
spite of the manufacturers. So I guess we’ll see if
Ford and General Motors really have the testicular
fortitude to back up their threats, or are they just
content to make loud empty noises at the big guys
while continue to pick on their weaker dealers?
I
hoped my last article, "Mayhem in Mayberry"
made you pause. Sadly enough, I have made predictions
in my last several articles concerning Ford’s Blue
Ovulation certification Program that have already come
to pass. If you’ll archive some of my recent past
articles http://zieglersupersystems.com
like "To Serve Man" which appeared in the
June issue, you’ll read where I predicted that Ford
would relax the initial requirements for Blue Evil
until virtually anyone could qualify. Then, once you
were hooked, I predicted that they would ratchet up
the standards, effectively putting many of the little
guys (gals) out of business. Well it’s already here.
They have just about taken away all of the obstacles
so most dealers can qualify initially. Of course, I
believe they’re just putting you under the ether. I
have actually received emails from dealers cheering
about this.
There’s
nothing wrong with The Blue Oval Certified concept.
It’s a great idea with a lot of merit. I could
support it in theory. It didn’t become sinister
until they starting tampering with the money. Then it
was no longer about customer satisfaction…it became
a much larger plot.
I
still believe that it’s still two-tiered pricing and
that it’s illegal…as it should be. I would hope
that the states would declare it illegal and throw the
entire program out. But, you know what, it’s a done
deal. Some people remind me of my Labrador Retriever,
Buffy. Just throw her a couple of bones, rub her belly
and pat her on the head and she’ll just lay right
down and shut up. It’s not about whether or not
it’s easy to qualify…it’s about whether or not
two-tiered pricing is legal and that’s an issue that
needs to be court tested.
I’m
sure glad that Gary Cooper had the guts to stand up to
Frank Miller and his gang in "High Noon".
For a moment there though, I thought Lee Van Cleef was
going to shoot Kane in the back but Grace Kelly shot
him first. See…even the pacifist wife came up to the
challenge when the battle was on.
Oh
well, it’s that time again, two-thirty A.M. Sunday
night is now Monday morning and I have just poured
myself a snifter of Remy Martin cognac. Swirling it
high, watching it in the light, I lean back in my
chair. Hey, did I ever tell you guys (gals) about one
of my favorite movies "The Man Who Shot Liberty
Valence"? Well, that’s another article.
More
Food For Thought
Another
one bites the big one. Sitting here laughing so hard
that tears are running down my face. Did you see where
CarOrder.com suddenly shut down their website and
layed off more than 100 employees? As I was reading
Automotive News last week the cover story was about
how CarOrder.com was calling it quits. On page 24 of
the same issue was an article proclaiming that
CarOrder.com had just linked their website to
CarDay.com, another online auction dot-communist
company. (A deal since dissolved) The article went on
to describe CarOrder.com as a company that
"enables consumers to research, configure, price
and finance a new car and have it delivered to their
home or workplace." They’re going out of
business on Page one and they are still enabling
consumers to buy cars on page 24.
Spokesperson
for CarOrder.com, general counsel, Jerry Ducharme was
quoted in several publications as saying that
"Breaking even was in sight." (Rolling on
the floor, laughing and snorting now, pounding on the
floor in a fit of mirth) Wow! He said that they were
almost about to break even, as if that was a
milestone!
They
have evidently blown through $100 million in seed
money advanced by parent company Trilogy Software
(Makes me nervous, this is the same company that is
doing the Ford dealers site).
CarOrder.com
is still led by 23 year-old Brian Stafford who is
evidently the incredibly brilliant driving force
responsible for that $100 million sucking sound.
Trilogy has now allegedly coughed up another $25
million additional seed money to buy dealerships.
(Brilliant move guys!) A CarOrder.com spokesperson
said…(are you ready for this?)…Wait a minute, I am
laughing too hard to type it…Liquid spewing out my
nose now…hang on…I’ll be okay in a
minute…coughing now… Okay here goes…
CarOrder.com spokesperson said… "Volume was
high when we subsidized sales. People are anxious to
buy cars on the Internet."
Where
in the hell do you find these people? And, worse yet,
where in the hell do you find anybody that would put
$100 million dollars in their hands? Did he really say
that volume was high if you sold cars at a real loss
by subsidizing the sales? He seemed to be rather proud
of that too. And, guess what? That 23 year-old guy is
still in charge.
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