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Mars
Attacks
(“Do
not run away! We are your friends!”)
Somewhere
from out of the depths of Director Tim Burton’s
twisted mind came the 1996 new-age comedy cult classic
movie, Mars Attacks. The plot was asinine, inane and
incomprehensible. It was so utterly absurd and
ridiculous you just had to laugh because of the sheer
stupidity of the plot.
The
movie began with thousands of flying saucers headed
toward the Earth. After pretending to be friendly, the
Martians launch an all-out invasion.
The
Martians are nasty evil little green suckers with
extremely big heads. They gleefully enjoy killing
people and performing unspeakable treachery. The
Martians are just pure evil but the naïve humans
simply can't or don't want to comprehend that. We keep
trying to find the good in them and we keep getting
burned.
The
Martians destroy everything just because it’s fun. I
was cracking up when they were using the statues on
Easter Island for bowling pins and when they posed for
photos like tourists in front of the Taj Mahal as they
blew it up in the background. As they performed these
horrible, evil acts they were laughing like maniacs
making this cackling laughing sound “ack…ack…ack…ack”.
We see Mount Rushmore defaced with Martian faces
replacing the presidents and then the Eiffel Tower is
melted down. Tears were rolling down my face when they
were trying to crush the Boy Scouts with the
Washington Monument. It was so incredibly stupid,
cruel, and unreal that you just had to laugh! You
barely get to know any of the characters before
they're zapped into charred skeletons. It’s like
little kids burning ants with a magnifying glass
In
one hilarious scene you see the French parliament
trying to make a treaty with the Martians. (Typical
French appeasement policy) The French Prime Minister
is talking to Jack Nicholson (who plays the president
of the United States) on the phone explaining that the
Martians are really misunderstood and they really only
want to be our friends. Nicholson tries to tell him to
run but…it’s too late…the Martians pull out
their ray guns vaporize the entire French Government
laughing maniacally the whole time.
The
Martians run rampant through the streets of every city
in the world brutally frying every human being in
sight, all the while they are yelling “Do not run
away! We are your friends!”
So
much happening and there’s so little space to tell
the story.
The
buzz about the demise of the Auto Collections is
center stage. The polite spin on the story as
presented by Automotive News would indicate Ford is
magnanimously selling these dealerships off in an
effort to improve dealer relations. Of course my spin
on the story is they’re bailing out after losing
their ass while suffering gross public ridicule due to
their weak, impotent, limp and flaccid failure as
retailers. Of course that’s just my opinion based on
documented embarrassing statistics. I call it another
double-cross gone sour not unlike my predictions about
the eventual outcome of the Blue Oval Certification
ambush.
Of
course I have been all over this dog from the very
beginning. I estimate Ford could have saved themselves
more than $200 million if they would have read my
articles over the last three or four years which
specifically predicted today’s events in detail,
exactly as they are unfolding now. Well, if the Auto
Collections were a learning laboratory as Ford has
claimed repeatedly…then what we’ve learned is that
Ford Motor Company Executives haven’t got a clue as
to what the retail public wants and they need to
totally stop interfering in the retail process..
The
newest joke my the office is… “How does Ford Motor
Company get an Auto Collection to show net profits
approaching a million dollars a year?” The answer
is… “First they buy a bunch of successful
dealerships that are net profiting ten million a year,
then put Ford Executives in charge, and then wait
seventy or eighty years to get back to a million.”
I
have read some recent quotes by industry celebrities
in Auto Snooze saying that the Ford Auto Collections
in Tulsa were now finally profitable and they could
have chosen to operate these stores for a while to
recoup some of their losses. Well, ‘scuse me folks,
by my calculations they would have to operate these
dealerships for approximately another three hundred
and twelve years at their current rate of dubious and
shaky levels of alleged profitability just to break
even after wasting all of the stupid money these
retailing geniuses have poured into this abysmal rat
hole…which, in the meanwhile, focused a spotlight on
the magnitude of their ineptitude from the top down.
Of course that’s just the way I see it.
The
fact that United Auto Group and Roger Penske had the
Tulsa deal wrapped up before it went public sent a
warm musky odor wafting through the air. Everybody
smelt it but no one wants to exactly be the first one
to point it out or own up to it. Other than the fact
they had the cash, what other criteria and deals were
involved? Are Penske and United Auto Group proven to
be a competent operation? I have seen some of their
numbers and I am aware of the legal and consumer
problems some of their largest dealerships are
currently facing in Memphis. Was this fair and
equitable to existing loyal Ford Dealers? How do they
intend to dispose of Oklahoma City…Rochester…and
Salt Lake City Auto Collections? Jim O’Connor,
president of Ford Division, has been quoted as saying
the other three Auto Collections will be broken up and
sold one dealership at a time. I picture a fair and
equitable public auction in the sunshine with
competitive bidding among qualified dealers don’t
you?
Tom
Gibson, chairman of Asbury Automotive Group was quoted
in several of the trade magazines as saying,
"Ford's track record has not been positive. I
have not seen the financials, but it appears they have
not been successful."
I
personally consider Asbury to be competent retailers
in the category with Group 1, Lithia and Sonic. Notice
I did not include AutoNation, CarMax and United Auto
Group on the competent side of my personal ledger. Now
here’s the chairman of Asbury less than subtly
indicating he feels there has to be some other,
perhaps undisclosed reason, Ford is selling the stores
to United Auto Group. As far as doing it to improve
dealer relations, quit it! This is Ford we’re
talking about…a company that has shown less than
warm fuzzy regard for their dealers as demonstrated by
their actions. I am watching this one to see how it
plays out down the road. Remember, Ford has just
handed a public company a monopoly to retail their
product in Tulsa without competition. Theoretically,
the public could get screwed here.
In
a June 24th article in the Detroit News titled, “Can
Ford Chief Ride Out the Storm?”
By
Mark Truby, we find the mainstream press is now
starting to seriously speculate as to whether or not
Jacques Nasser’s days might be numbered and counting
down rapidly. Of course, I have been speculating about
that for more than a year now in this magazine.
I
called Truby and discussed his article with him,
especially the part where he said… (Quote) “Cost
cutting is the new religion at Ford and that's why the
company produces vehicles with more defects than its
six largest competitors, according to a survey by J.D.
Power & Associates.”
Hey…hey…hey!
Does that sound like something I wrote five years
ago…three years ago…last month, or what? As you
may be aware, I have repeatedly warned that Ford’s
problems with quality were a result of Alex
Trotman’s, and subsequently Jacques Nasser’s cost
cutting excesses and would eventually bleed over into
the mainstream press. I feel the damage these two have
inflicted on the brand image will take the company at
least a decade to fully recover from.
The
article went on to say… “For the first time,
Nasser is facing tough, persistent questions about his
effectiveness as a leader.”
All
of this coincides with a survey evidently commissioned
by Automotive News with the Dohring Company (a company
I respect unlike some other alleged research firms
with dubious perceived ethic dilemmas). According to
the Dohring survey results, it would seem most
Americans believe Ford Motor Company shares the blame
and responsibility for deaths and injuries in Explorer
rollovers. According to the Dohring survey 74 percent
of respondents felt Explorer rollovers were due to a
combination of the vehicle and the tires. Only 13
percent said tires were solely responsible for the
accidents and resulting deaths. Finally, 13 percent of
respondents said they felt the Explorer was to blame,
not the tires. Of course, bear in mind, this is just a
survey based on what people might think. BUT, then on
the other hand, it sure seems to paint Nasser in a bad
light if he were a politician relying on public
opinion polls.
A
whopping 74% of the survey participants rated Ford
Motor Company in the poor to fair rating categories on
their honesty in handling the Firestone recall…and
our boy Jacques Nasser, of course, is the upfront
spokesperson. I project this to mean that perhaps the
public distrusts Nasser.
In
a similar poll conducted for Reuters by The Zogby
Poll, 44% of the respondents did not consider the
Explorer to be safe as opposed to only 37% who felt
that it was safe.
Of
course Nasser’s answer to the questions about his
leadership ability, his perceived lack of effective
vision, and questions regarding his competence and his
honesty might be arrogantly summed up in this
quote…"I know how to get through tough
times," says Ford President Jacques Nasser.
(Note: Ziegler to Billy…what are you waiting for?
Drop the axe already.)
In
an unrelated story, did you see where Hyundai Motor
Company and Leo Burnett Worldwide, Inc. were presented
the Gay.com and PlanetOut.com Gayest Commercial of All
Time Award for their television commercial titled
“Boy Toy”?
The
San Francisco press release said in part…To select
the nominees for the Gayest Commercial of All Time, a
panel of jurors, made up of gay, lesbian, bisexual and
gay-friendly advertising and marketing professionals
from top-tier agencies and consumer products
companies, narrowed down a field of 20 commercials
based on their creativity, style and ability to
effectively convey their message. There was no mention
of second place or runners up or Saturn Commercials.
By
the time you read this (written on July 2nd) history
should already be proving me out. Going into July with
rebates and incentives averaging more than $1800 per
vehicle on top of cheap money and subsidized leases
there has been a temporary euphoria and a lot of
increased sales activity during the month of June.
Now
we see General Motors moving with increased targeted
desperation offering customers “early out” on some
leases if they buy or lease another GM vehicle. Of
course this is paper transference of loss but it does
move one additional unit. The very positive thing
about this program is that it assures these customers
will stay with General Motor’s products instead of
jumping ship at the end of their leases. Even
Oldsmobile dealers are proving they can sell cars when
the factory does their job.
My
friends out there who are Chrysler dealers tell me
that there are literally oceans of off-lease Chrysler
products sitting behind the dealers’ fences waiting
for months for the someone from the factory to come
and pick them up. In other words, the consumers turned
in their vehicles at the end of their leases but the
factory has chosen to allow them to be stored on the
dealers’ lots, in many cases for months and months,
and they never came to get them while they sat and
depreciated. Some insiders tell me that as many as
367,000 additional previously owned units and program
cars are about to be dumped into the retail arena in
the fourth quarter and the beginning of the first
quarter.
All
of these market factors are ganging up and borrowing
from future sales by artificially moving future demand
up into the present. Then, if what I hearing is the
accurate, there is going to be an extraordinary glut
of off lease and late-model program cars of all makes
and models, foreign and domestic, dumped into the
retail market at year’s end. This will take place
conveniently after the dealers have filled the order
banks.
It
seems like only yesterday that those masters of the
fantasy press release, AutoByTel were predicting that
they were about to take the Old World by storm. Yes, I
remember clearly just a few short months ago reading
the flowery-worded press releases about the future of
AutoByTel in Europe. Now, there is another less
flowery news item that says… “Autobytel.com Europe
to cut staff and restructure”. Oh Good Gawd Maud,
don’t tell me those wacky optimists at AutoByTel
have burned the stockholders…again. I just checked
and their stock is trading at $1.42 a share, which is
down from nearly $9.75 a share less than a year
ago.Hey, now don’t get me wrong here. J.D. Power
(credibility personified?) really gives these guys
high marks as one of the leading Internet lead
providers. As a matter of fact, their tagline on every
press release says they are the leading provider of
online automotive buying services. I believe that too.
AND, if you believe that as I do, you would also have
to conclude the Internet is a bust for car sales,
which it is.
Now,
we see AutoByTel significantly reducing and laying off
its European staff due to a drastic reduction of
business there. On a positive note however, AutoByTel
has stated that they will continue to operate their
Web sites in the U.K., Netherlands, Japan, Canada and
Sweden. Hooray! I am sure the Europeans are jumping up
and down about that. (Yawn)
According
to AutoByTel, the European division was formed to
extend new business with new investors (notice I
politely didn’t refer to them as suckers) in
additional European countries. That is the Gospel
according to Mark Lorimer, chief executive and
president of Autobytel.com.
In
a related item, also dated today coincidentally, on
the PR Newswire comes a fresh press release by guess
who? You got it…AutoByTel…who told you? The
headline reads… “New Study Shows Autobytel.com
Continues to Enjoy Greatest Percentage Of Its Dealers'
New-Vehicle Sales.”
The
press release says that a new J.D. Power and
Associates study released just today finds that
AutoByTel.com continues to provide the greatest number
of Internet leads or sales to dealers. It went on to
say that… “Autobytel.com exceeded the industry
average in four out of the five categories measured by
J.D. Power and Associates and was the leader in the
number of online new vehicle leads per dealer.”
Evidently
as a validation of their market position, the press
release went on to say… “An example of this
integration is the current General Motors
locate-to-order test taking place in Washington
D.C.”
You
know I promised some executives at General Motors
I’d give them a break on this thing and that I would
sit back and watch…giving it a fair shot. I sort of
promised that I would back off of AutoCentric LLC in
my column until the results were in. Well the results
are starting to come in and it’s exactly the way I
knew it would be. Catch next issue as Ziegler lets
loose with the facts.
The
AutoByTel press release went on to say, “The study
also gave unique insight into the prices paid by
online consumers. According to J.D. Power and
Associates, online car buyers pay hundreds of dollars
less than their traditional counterparts.”
Here’s
the fun part… “ For the first time, the J.D. Power
and Associates 2001 Dealer Satisfaction Study was
based on e-mail responses from 1,172 Internet managers
and sales persons responsible for Internet sales.
“Are you laughing as hard as I am here? It was an
email survey asking Internet managers to answer the
survey. No stacked decks here (wink-wink)…nothing up
our sleeves…please ignore the little man behind the
curtain!
What
a freakin’ miracle that such a positive survey
supporting AutoByTel would be released bearing the
weight and the unquestionable integrity of the
irrefutable J.D. Power and Associates. Who woulda’
believed this report would show up just in the nick of
time. It should certainly help to counter the negative
press after AutoByTel’s embarrassing rout, totally
collapsed business plan, and subsequent retreat from
the European arena. Damn, what a fortunate
coincidence, huh?
Oh
no! Please say this can’t be happening! I just read
where Piyush Gupta, founder of LiquidPrice.com says
his company has run out of money and, apparently shut
down retail operations. How can this be happening? I
can’t bring myself to believe another dot-com has
bit the big one. Gupta is quoted as saying the website
was closing more than 350 to 400 car sales a month.
Wow! He claimed to have more than 700 dealers signed
up in nine major metropolitan population centers. Help
me with the math…check my figures here…is that
just one-half a unit a month per dealer subscriber?
Hey! I may be getting a clue as to what happened here.
Currently Gupta has revised and tweaked his business
model and he’s sure he’s got it right this time.
He’s out there right now looking for another $20
million in venture capital to start over.
Inexplicably, so far it seems he hasn’t had any
nibbles.
My
advice to Mr. Gupta is…“Hey Dude…try General
Motors! Hell, they took a major flyer on AutoByTel.
Trust me on this one Piyush; don’t go for just a
measly twenty mil’ ask them for fifty million…I
have seen strong evidence that they’ll buy anything.
They’re sort of like Mikie in the old Quaker Life
commercials.”
Speaking
of Ron Zarella…I guess the word is out. Good news is
that General Motors is finally planning to release the
new Cavalier a full year ahead of schedule; the bad
news is it’s going to be another rebadged Opel. Even
though General Motors North American designers were
looking for an extensive redesign, the new Cavalier is
just going to be the 2003 Opel Astra with a couple of
superficial cosmetic changes. Didn’t I tell you that
would happen? You could have read that here, in this
magazine, six months ago. At the time I wrote it some
GM insiders denied it to inquiring dealers. This is
just an opinion but it appears to me that we are once
again seeing Ron Zarella opting to squander the
historical heritage of “Brand Equity” on an
inferior car. Just slap any nameplate on an Opel and
voila…we got another Chevrolet. As for the Sunfire…it
will probably end up being replaced by the Vibe, a
small sport utility-wagon hybrid developed by Toyota.
Sipping
at my Cognac now…occasionally swirling it in the
light and smelling the bouquet. I am still thinking
about the movie, “Mars Attacks”.
Picture
this; the Martians are running amok vaporizing every
human being in sight and destroying all of our
monuments and buildings. Remember the part in the
movie when the Martians vaporized the entire French
Cabinet of Ministers when they were trying to make a
peace treaty with them? Hey that reminds me, did you
read where the NADA said the best way to deal with
Blue Oval Certification issues was to keep open lines
of communication with the factories.
The
situation seemed hopeless. You begin to believe these
short, sadistic, cruel big-brained aliens are
unstoppable. BUT, like all pure evil, the Martians had
a fatal weakness. Totally by accident it was
discovered that their heads exploded into a blob of
purple goop when they heard recorded music sung by the
legendary country music artist, Slim Whitman. So in
the end troops went through the streets playing Slim
Whitman music on loud speakers blowing up the
Martians.
Wait
just a minute! By Golly, that’s it…that’s the
answer! Think about it for a moment. In the movie they
were dealing with little short evil aliens with
extremely large heads. All we need to do to solve the
problem is to pipe a little Slim Whitman music into
the elevator music in a certain building in
Dearborn…and then…off to the Renaissance Center
downtown. I love it when a plan comes together.
More
Food For Thought
Phil
Brady, the new president of the NADA says he plans to
give the organization a more aggressive profile.
He’s out front talking loud about more visibility,
which indicates to me that we should be seeing the
dealers’ representative organization taking to the
battlefield more often in the courtrooms defending the
dealers’ positions as the factories relentlessly
attack state franchise laws…as they try to tear down
and erode the value of the franchises. So far the
states have had to carry the struggle while the NADA
has appeared impotent, backing off in favor of empty
dialogue with the Evil Empire.
Personally,
I am willing to wait and watch and evaluate. Actions
are much louder than words. I agree with the implied
message Brady is sending out. I also believe the
dealers are not as strongly aligned with their
National Organization as they once were. I also
believe it is the NADA’s responsibility to fully
restore their faith in the strength and the
determination of the organization.
I
would really like for Brady to be everything he should
be. Visibility is a good word…Action is better word.
The job is about much more than conventions and booth
space and photo opportunities. I believe every dealer
in the country will be watching to see if there is
going to be power and substance or just empty
visibility. The NADA has my total support and respect.
Now is the time for the Automobile Dealers and their
National Organization to reinvent their mission and
their resolve to solidify the future. I wish Mr. Brady
good luck!
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