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2010 Mustang vs. 2010 BMW Z4

Two redesigned sports cars are generating a ton of hype lately; one has been an American icon for over 40 years, the other is a relatively new innovation from our friends in Germany.

The 2010 Ford Mustang and 2010 BMW Z4 are very different, yet they’re generating equal amounts of passion from their loyal followers. Both deliver horsepower and speed. Both make a statement about their drivers. Let’s take a quick look at both, and then it’s your turn to tell us which you’d rather have!

The Mustang

2010 Mustang

The biggest news from the Mustang camp is the possibility of Ford’s new EcoBoost twin-turbo V6 being offered. This is an engine capable of a devastating 415 hp that would be offered alongside the V8 options. (No guarantee that this turbo will make it into production, though.)

Remember when GT Mustangs came with a 5.0-liter V8 rather than the 4.6? Oh yes, the 5.0 is coming back, baby! Expect around 325-350 horses out of that power plant. There will also be a Bullit edition and the same entry-level V6 as before. Looks like we’ll again be treated to a Ford-built Shelby GT 500 version of the new pony, with at least 500 hp, though I’d bet on more. Can you say BOOYAH!?

The Mustang’s interior also gets revamped to accommodate a bigger navigation screen and audio gear.

The Z4

The new Z4 will be offered in sDrive30i and sDrive35i trims. Completely redesigned inside and out, the exterior redesign is what I’m most excited about, as the current Z4 is a bit too chiseled for my taste. The new design is sleeker, more elegant, and more sophisticated, in stark contrast to the arrogant, muscled look of the Mustang.

The other big news is the addition of a retractable two-piece aluminum hard top for this Bimmer in place of the current soft top.

Oh, but you want to know about performance? The sDrive30i is powered by a 3.0-liter V6 capable of 255 hp. The sDrive 35i has a twin-turbo 3.0-liter V6 rated at 300 hp and a 0-60 sprint time of 5 seconds.

Opting for the Z4 will also give buyers the option of adding a Sport Package with Adaptive M Suspension and Electronic Damping Control. This gets complicated, but the system allows for more driving control and the ability to change damper forces on the Adaptive M Suspension and adjust the response thresholds of Dynamic Stability Control.

This new Z4 will be built in Germany, as opposed to the current Z4, which is built in America.

So there you have it. Which would you rather have - the pure muscle and style of the Mustang or the sophisticated driving experience of the BMW Z4?

-tgriffith

Detroit Gets a Christmas Present . . . Sort of

Can you believe it? George W. Bush has saved the car industry. All those cheerleaders for instant bankruptcy, like Sen. Richard Shelby (R. Tenn.), can now go back to their drawing boards, along with the automakers.

Chrysler Line Worker Gets Paulson TARP Blood

Chrysler Line Worker Gets TARP Blood from Paulson

Chrysler and GM got a transfusion of $13.4 billion in loans to tide them over to March, with the prospect of $4 billion more to come in February if necessary. The deal is pretty much the same as the earlier bailout bill Congress offered that last week went down to defeat. It essentially buys the industry time to come up with a viable (much debate on the meaning of that term) plan for reorganization.

A couple of interesting add-ons to note: the administration, according to the Washington Post, “has set as a target that the companies convince holders of up to two-thirds of their outstanding debt to accept stock in exchange, and that half of the payments into a union benefit fund be made in company stock.”

The idea is to get all major stakeholders to take a haircut, sharing both the present pain and the risks to come.

Cerberus Capital, the buyout firm that owns Chrysler, agreed “to hand over [its] equity in the company’s automotive operations to labor and creditors as part of its loan agreement with the U.S. government.” GM boss Rick Wagoner acknowledged that the road ahead would be tough but also called the federal loans a blueprint for the company’s second 100 years.

So who is going to oversee all this? There is talk that Secretary Hank Paulson will function as the new car czar. Hmm. This is the guy who opposed helping the automakers in the first place and refused for months to take any money out of the TARP funds—which they have done, finally, to support this bailout.

And for the moment, Mr. Bush seems to have given over his talk yesterday of an “orderly bankruptcy,” though that may well be down the road for the industry in any case. The President said he didn’t want to drop this financial bomb on the President-Elect in his first day in office. But it looks like Mr. Obama will have to defuse it anyway.

Can you think of a worse person than Hank Paulson to oversee the bailout? Let us have your nominations.

—jgoods

Bailing Out the Bailout: Don’t Hold Your Breath

Watching Congress in debate is like subjecting yourself to a parade of television commercials. You hear an unending stream of features and benefits—as well as a zillion reasons why you shouldn’t buy the other guy’s product.

Tuning in to C-Span last night (always an uplifting experience), I heard speaker after speaker lambasting the financial bailout bill Congress passed in September. Republicans in particular were hosed about the $350 billion that went to AIG and other banks and which has produced zilch as far as freeing up credit goes.

That’s the background in which the Senate will debate today the newly passed (by the House) auto bailout bill. At this point, passage looks doubtful. On C-Span I heard a lot of talk about throwing good money after bad. What I didn’t hear was how really dismal our economic picture is right now, and how dependent we are on the auto industry, still.

Compromise, as in politics, was tried in the auto bill. That doesn’t seem to have worked—or at least brought Republican Senators to heel to the President. In the Senate discussions, it would help to focus debate on the realities of the car industry instead of praise and blame for past actions, or promoting more features and benefits of the proposal at hand. Here are some things the World’s Greatest Deliberative Body might want to consider:

1. The auto industry’s greatest problem, as David Leonhardt pointed out, is not really labor cost (only about 10% of vehicle cost); it’s the fact that “many people don’t want to buy the cars Detroit makes.” The Big Three cannot survive in anything like their present form.

2. What is the real purpose of the bailout bill? It can’t solve the basic economic and management problems of the industry. If Congress needs to create a holding action until March, then it should take the three months to study and adopt the best reorganization plans because each of the Big Three is in a different financial situation and requires different treatment. In other words, adopt the bridge loan concept that the bill proposes. The larger question: how far is the U.S. prepared to support and/or subsidize its basic industries?

3. If the purpose of the bill is to provide economic stimulus and prevent job loss, it’s not a bad deal. Keeping people in their jobs is lots cheaper than providing unemployment or creating new jobs. So $14 billion may not be a bad price to pay for keeping some 2 million workers from being dumped on the streets. Plus giving the industry some breathing room.

Finally, as often happens, Congress is attempting to solve massive (and different) problems through a piece of hastily considered legislation. Get your priorities straight, folks. The main difficulty here is time: the possibility that GM will be out of cash by the end of the year.

As a footnote, a new Bloomberg/LA Times poll finds that “47% of Americans favored some sort of financial rescue for automakers, slightly more than the 42% who opposed a rescue.”

As of 6:00 p.m. Thursday, Republicans are proposing an alternative bill. Do you think Congress can still thrash out a solution? Or will it come to bankruptcy? Let us have your comments!

–jgoods

Still Squabbling Over the Bailout

The media told us we’d have a deal sometime Monday. Now it’s Tuesday a.m., and they are still inching toward a financial rescue package. One General Motors exec reportedly is already talking about the need for more than the $15 billion under consideration. Meanwhile GM continues to burn through cash at a reported $2 billion a month, and the fire has spread abroad as Fiat seems to be seeking a suitor. The CarGurus Blog wrote on this unhappy trend last week.

Senator Bob Corker (R-Tenn.), a thoughtful man, was quoted as saying the plan “appears to be weak and lacking the benchmarks we believe are necessary to put these companies on a viable, sustainable path.”

Most in the Congress want a viable long-term reorganization plan for the companies, with strict accountability and “haircuts” for all the stakeholders (unions, management, suppliers, dealers, investors), and you can be sure these are going to come, one way or another.

The unions have already taken a big hit. As UAW Chief Ron Gettlefinger put it, “To my knowledge, no one has proposed cutting the compensation of everyday active or retired bankers, bond traders, and office or building personnel who work at AIG, Bear Stearns or the numerous banks that have received billions in federal aid.”

Does he have a point? What’s fair is fair, right? Well, of course, it all depends on where you sit.

If you’re Barney Frank (D-Mass.), your draft bill includes taxpayer protections, prohibitions on bonuses, golden parachutes, private jets and payment of stockholder dividends. If you’re Czar-in-Chief in the Oval Office, you’ll want to appoint a new Car Czar to act as principal enforcer so there won’t be any indecision or temporizing.

If you’re sitting at home waiting for the next shoe to drop in the unfolding economic chaos, sit tight and stay tuned. This bailout bill won’t make anybody happy.

Is the present bailout bill the right thing to do for the auto industry now? Leave your comments below.

–jgoods

Look who’s getting in line for government bailouts!

Bailout Fever is spreading.

As Ford, Chrysler and GM plead their cases for $34 billion in government bailout money, another automotive crisis appears to be looming on the other side of the Atlantic.

I thought the collapse of the auto industry in the U.S. was caused mainly by poor management and the production of gas-guzzling trucks and SUVs. That’s why I was surprised to hear that European automakers are dealing with similar challenges, and are asking their governments for $50 billion in assistance.

For example, Jaguar Land Rover, now owned by India’s Tata Motors, is asking the British government for $1.5 billion in assistance. (Why they aren’t going to India’s government is an entirely different blog topic!)

While not quite as dire as the U.S. situation, European car sales were down 15 percent in October, with the outlook for 2009 even worse. Many European carmakers are planning temporary production shutdowns and some are already reducing their workforces.

Looking a little deeper at the situation, I have to bring up this fact: General Motors has a large stake in Opel, the German carmaker. Should GM not get a bailout, Opel will probably receive help from the German government. That could create a domino effect where other European automakers perceive an unfair advantage, resulting in a major case of the ‘me-toos.’

It’s entirely possible that the European situation arose out of the politics of opportunity, presenting them with an easy way out in the form of government bailouts. It sure looks like U.S. automakers are paving the way out of the land of free-market business and into the world of government subsidies.

I believe it’s best to let the world’s strong auto companies live and the weak ones die.

But what do you think: Do the European car companies need a bailout package?

-tgriffith

The cleanest car in the world?

The Green Car of the Year

The Green Car Journal began its Green Car of the Year program in 2005, bestowing the award on the Mercury Mariner Hybrid and the Chevy Tahoe Hybrid before announcing this year’s winner:

The 2009 Volkswagen Jetta TDI.

Yup, a diesel won the award for the first time rather than a hybrid engine. To me, this is proof that the award is becoming more of a true gauge of efficiency rather than a hybrid-hype machine.

The Jetta diesel, which delivers 41 MPG on the highway, achieves fuel efficiency nearly equal to that of a gas/electric hybrid at a more affordable price. The engine signals the arrival of highly efficient, advanced diesel sedans that meet emissions requirements in all 50 states.

For the award, the Jetta was up against the Ford Fusion Hybrid, the BMW 335d, the Saturn VUE 2-Mode Hybrid and the smart fortwo - all worthy competitors that deliver some of the cleanest driving options available.

The fact that one of the diesels won (the BMW is also a diesel) signifies that the technology has evolved to the point where it’s a truly viable solution for reducing our consumption of oil and can bridge the gap until a reliable, renewable energy source can be implemented.

Now that Volkswagen has this award under its belt, we can look forward to more clean diesel TDI vehicles, as evidenced by the Touareg on display at VW’s booth at the LA Auto Show.

What would you buy: a clean diesel or a hybrid? Leave your comments below!

-tgriffith

What will Obama mean to the auto industry?

Will he bring relief to the Big 3?

I’ve written in this blog that I don’t believe the U.S. auto industry should be bailed out by the federal government. I’m a believer that people and companies need to suffer or be rewarded the appropriate consequences of their actions.

I can see the point, though, that a failed auto industry would wreak havoc on other businesses and cost the country thousands of jobs. That’s certainly not a good outcome, and it’s why the government is considering a bailout.

President-elect Obama addressed the issue briefly in his first news conference, saying, “The auto industry is the backbone of American manufacturing and a critical part of our attempt to reduce our dependence on foreign oil. I would like to see the administration do everything it can to accelerate the retooling assistance that Congress has already enacted.”

That’s an eloquent way of saying he wants to fund a bailout. Obama appears in strong support of a proposed $50 billion bailout package, with $25 billion in direct loans and another $25 billion to come later, intended to help fund a United Auto Workers retiree health care trust.

I’m absolutely thrilled that Obama won the election and am proud to live in an America with him at the helm. I’m also a huge supporter of the auto industry and am a true car-nut. Yet I can’t bring myself to support the bail out of companies that have made poor choices.

Under Obama, the U.S. automakers will likely receive the help they need and avoid bankruptcy. If, that is, they can hold on until President Bush hands over the presidential reins.

My opinion, though, is that Ford, GM, and Chrysler would be better off - and we’d see better vehicles and stronger companies in the future - if they were forced to reorganize themselves under bankruptcy.

Do you agree?

-tgriffith

Pontiac: performance or practical?

Pontiac has hit a homerun with the G8. So why is it being yanked?

When you think of performance vehicles, odds are names like BMW, Porsche, even Mercedes or Lexus will come to mind. Pontiac probably wouldn’t make the list.

Yet Pontiac is the company with the slogan of “game changing performance.” Of their 6 models, though, only two of them stand a chance of living up to that promise, and they’re both going away.

The RWD G8 and Solstice have given us reason to hope that the slogan would become more than just a marketing ploy, but oh my how things can change. Pontiac recently announced the discontinuation of these cars, leaving GM’s one-time ‘Driving Excitement’ brand with only front-wheel-drive midrange sedans, coupes, and unexciting crossovers. So much for GM’s claims of eventually turning Pontiac into an American version of BMW.

Without the G8 and the Solstice, Pontiac is left with the G6, the G5, the Torrent, and the Vibe. That’s certainly a lineup capable of delivering an adequate commute, but hardly reaches the performance level that Pontiac has always aimed for.

This is a sign of two possibilities:

GM is in the process of rebranding Pontiac toward the fuel efficient and practical… or
GM is in the process of phasing Pontiac out completely.

Option 1 would be a complete 180-degree shift from Pontiac’s performance history and is the less plausible outcome. Option 2 is more feasible, especially considering the talks of a possible GM/Chrysler merger. Pontiac would be left in the unenviable position of being an expendable brand simply because its main selling point, performance, would be gone.

Pontiac isn’t worth keeping around if they’re not even going to try living up to their ‘game changing performance’ claim. I’d rather see Pontiac ride valiantly and proud into automotive history than relegate itself to practicality.

What do you think- Is a Pontiac without any performance worthy of existing?

-tgriffith

Is this the car that will change the world?

Chevrolet has been tantalizing us with the promise of an all-new electric sedan called the Volt.

Will this car revolutionize the cars we drive, or be the nail in the coffin for struggling GM?

Chevy hasn’t even committed to an official launch date for their much-hyped innovation, but the potential to score a major home run with it is huge. Yes, it’ll be expensive for a mid-size family sedan and yes, GM will still lose money on every one sold.

So how could this possibly be a winner?

It’s all in the facts, the marketing and the target audience.

The average commute for 75 percent of Americans is less than 40 miles per day. Hence the Volt’s range to run without using a drop of gas: 40 miles. At first not impressive, but when positioned as a daily short-range commuter it’s suddenly an environmentalist’s dream.

Pricing hasn’t been released, but initial estimates are the Volt will cost between $30K and $35K. GM’s cost on each one is rumored to run about $40K.

Simple economics point to the Volt being a terrible investment.

But we obviously don’t live in the times of simple economics anymore. While still a gamble for GM, the Volt represents the future of vehicle design. No doubt some company needs to step up to the plate and offer an alternative source of thrust for the cars that transport us. GM is doing just that; creating a car capable of hauling us to work or our families to the grocery store without ANY gas.

GM is hoping that early adopters with the means to afford one will buy about 15,000 Volts per year, thereby reducing the cost over time for the rest of us. Those people are out there, and the Volt could very well be the car that Earth has been waiting for.

What do you think: Is Volt a savior or a one-way ticket to bankruptcy for GM?

-tgriffith

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