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Archive for February, 2011

Insurer Wants FBI to Pay $750,000 for Crashed Ferrari

Agents may have wrecked F50 on a joyride.

by on Feb.25, 2011

A Ferrari F50, like this one, was wrecked while impounded by the FBI.

You break it, you bought it.

That’s what Motors Insurance Corp. is telling the FBI after learning that an agent apparently wrecked a Ferrari F50 that was supposed to have been stored in a government impound lot.

The story starts out in September 2003, when the $750,000 supercar was stolen from a dealership in Rosemont, PA.  The insurance company paid off on the loss while police went looking for the car.  While it might seem difficult to hide such an exclusive automobile, the Ferrari F50 wasn’t recovered until August 2008, when authorities discovered it in Kentucky.

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Oddly, the story gets even more murky once the supercar landed in police hands.

The F50 was supposed to remain in a secure storage lot while authorities prosecuted the thief.  But it appears that at some point, it was taken out for a ride and had a close encounter with a tree.  Learning that the car was wrecked, Motors Insurance sent the FBI a $750,000 bill, which the feds have repeatedly rejected.


Feds Planning Fast Sell-off of GM Shares

Government won’t wait for stock to rise.

by on Feb.25, 2011

GM reports its first annual profit since 2004.

After last November’s successful initial public offering of General Motors stock there were signs the White House might wait to sell off the remaining government-owned shares hoping to maximize the Treasury’s return. But a senior Obama Administration official says the goal is to get out of GM as quickly as possible, even if that means selling at a loss.

“The writing is clearly on the wall that the government is getting out of the GM position,” says Austin Goolsbe, chairman of the Council of Economic Advisors. “The government never wanted to be in the business of being majority shareholder of GM. It was only to prevent a wider spillover, negative event on the economy. So we’re trying to get out of that.”

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Starting with former President George W. Bush, the government has invested $49.5 billion in keeping GM alive – and billions more to bail out Chrysler.  That got taxpayers a 60.1% stake in the bigger maker, though that dropped to 33% as a result of what is generally seen as a very successful GM IPO, last year.

The maker originally was looking at an initial “strike price” of as little as $26 a share but ultimately came to market at $33.  GM stock has since nudged the $40 mark – with some analysts predicting it could hit $50 a share – though it has taken some hits, in recent days, as fuel prices have soared in the wake of the crisis in Libya.


Lexus CT 200h: Slow-speed Driving Fun

Luxury automaker's latest hybrid is more than a dressed-up Prius.

by on Feb.25, 2011

The Lexus CT 200h is fun to drive, but it doesn't accelerate quickly.

It would be easy to write off the Lexus CT200h is just a gussied up version of Toyota’s hybrid poster child, the Prius.

It’s true that the CT 200h shares its platform and most of its hybrid mechanicals with the Prius, but where the Prius is a snooze to drive, the Lexus is fun. Can an underpowered hybrid that’s geared for mileage, not performance, be fun? In a word, yes.

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If you need eye-popping acceleration, look elsewhere. In fact, if you expect average acceleration, look elsewhere. With a combined 134 horsepower between its 98-horsepower 1.8-liter four cylinder and 80-horsepower electric motor, the CT isn’t going to win any stoplight grand prix. Well, unless, the competition is a Prius.

But the CT is one of those cars that make spouses complain “What, do you think you’re Mario Andretti?” The hefty steering begs for you to take corners a little faster than normal, clipping apexes with the precision of a sports car. So there’s a Prius lurking under the CT’s sheetmetal? No one will ever know.

Muller Selling Spyker, Concentrating on Saab

Former Russian partner snaps up sports car maker for $21 mil.

by on Feb.24, 2011

Image By: Len Katz

Victor Muller will focus his attention exclusively on Saab, now.

Intending to focus his energies on his struggling Swedish car operations, Victor Muller is selling off his tiny Dutch sports car company, Spyker.

Muller, who purchased Saab Automobile just over a years ago, will be paid $21 million for Spyker, but could get about $25 million more over the next six years, depending on the success the brand has under its new owners.

The purchaser is Russian businessman Vladimir Antonov, who had previously been Spyker’s chairman and key investor, with a 29.9% stake.  Antonov was forced out of the company when Muller when Muller began discussing the acquisition of Saab from its former owner, General Motors, which refused to negotiate while the Russian oligarch was involved.

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Originally founded a century ago, Spyker collapsed in 1925, the name revived by Muller a decade ago.  It produces an assortment of sleek supercars priced around $200,000 apiece.  In 2009, the last year for which sales numbers are available, the company, based in Zeewolde, Netherlands, sold a total of 36 vehicles.

Spyker went public in 2004 and has consistently lost money since then.


VW/Porsche Merger at Risk

German prosecutors expand investigation of sports car maker.

by on Feb.24, 2011

Former Porsche CEO Wendelin Wiedeking is one of several executives under prosectors' scrutiny.

The planned merger of Porsche with the bigger German automaker Volkswagen AG is likely to be delayed – and may be called off entirely – as the result of an intensifying investigation of actions taken by current and former Porsche executives.

German prosecutors are looking into possible market manipulation, breach of trust and credit fraud stemming from the abortive effort by Porsche to take over its bigger rival.  Among those under the microscope are former Porsche CEO Wendelin Wiedeking, the executive who triggered the attempted acquisition before being forced out when his company had to concede defeat.

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As part of a settlement, the debt-laden Porsche agreed to allow itself to instead be taken over by Volkswagen.  But that plan, Porsche officials today acknowledged, is now in jeopardy.

For their part, prosecutors in Stuttgart, home to Porsche, said three executives are facing accusations they provided “false or incomplete information” to banks involved in the planned takeover’s financing.


First Look: Aston Martin Virage

2 doors, 12 cylinders, 490 horsepower. You do the math.

by on Feb.24, 2011

Aston revives the old Virage name in a new model slotteds between the DB9 and DBS.

Aston Martin is bringing back an old name, but the 12-cylinder Virage, making its debut at the upcoming Geneva Motor Show, is anything but retro.

With striking xenon headlamps tapering into the low-slung head and framing a new 5-bar grille, the 490-horsepower Aston Virage is the latest entry designed to pull the classic British brand forward.

The coupe occupies a sort of middle ground between the Aston DB9 and DBS models, 20 more horsepower than the former, 20 less than the latter coming from its 6.0-liter powerplant.  The Aston Virage also makes 420 lb-ft of torque.

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On the mechanical side, the new coupe gets new adaptive dampers that can switch between five degrees of firmness with the touch of a button.  A modified exhaust manifold enhances the resonant roar of the big V-12.

As with the other DB models, the Aston Martin Virage is aluminum intensive, reflecting the British maker’s focus on stiff, lightweight vehicles that deliver even better performance than the raw horsepower numbers might otherwise suggest.


GM Beats Analyst Expectations With First Profit Since 2004

“We still have a lot to do,” says CEO Akerson.

by on Feb.24, 2011

Still plenty to do, said CEO Akerson, despite GM's first reported yearly profit since 2004.

General Motors Corp. made a profit of $4.7 billion during 2010, including $500 million in net income during the fourth quarter despite a 25% drop in earnings from its Asian operations and continuing losses in its struggling European automotive business.

GM also confirmed Thursday it will distribute a record profit sharing checks averaging $4,300 to 45,000 hourly workers in the United States. The payments, which will cost the GM about $189 million, are substantially larger any GM has distributed to workers since profit sharing was first included in its union contract in 1982.

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“Last year was one of foundation building,” Dan Akerson, chairman and chief executive officer, said, adding that, “Particularly pleasing was that we demonstrated GM’s ability to achieve sustainable profitability near the bottom of the U.S. industry cycle, with four consecutive profitable quarters.

It was the first time GM was profitable during all four quarters of the calendar year since 2004.  The maker subsequently ran up about $80 billion in losses before plunging into bankruptcy in May 2009.  It emerged from Chapter 11 protection two months later, but only after receiving $49.5 billion in federal assistance.

“We know we still have a lot to do,” Akerson said Thursday during a conference call with analysts and reporters.


Toyota Recalling 2.2 mil More Vehicles Due to Gas Pedal Jamming

News comes after maker seemingly cleared in federal unintended acceleration investigation.

by on Feb.24, 2011

Added to Toyota's long recall list.

Toyota will recall another 2.2 million vehicles in the U.S. to fix a problem that could lead those products to suddenly surge out of control, it announced today.

The move was an unexpected and seemingly self-inflicted setback for a company that seemed poised to put the ongoing issue of so-called “unintended acceleration” behind it.  The announcement comes a year and a day after Toyota’s top U.S. executive, Jim Lentz, apologized to Congress for delaying action on the runaway car problem.  But it also follows by less than two weeks news that a federal investigation had ruled out mysterious electronic gremlins that might cause Toyota products to surge out of control.

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This is the third major recall by the Japanese maker to deal with unintended acceleration since October 2009 – and could raise questions about why it has taken Toyota so long to act.  Last year, the maker paid a record total of $48.8 million in federal fines for failing to act promptly on safety issues, including problems with sticky accelerator pedals.


Breaking News: GM Reports First Annual Profit Since 2004

$4.7 bil figure further evidence of recovery, maker says.

by on Feb.24, 2011

GM reports its first annual profit since 2004.

General Motors has posted $4.7 billion in earnings for 2010, its first annual profit since 2004, and another indication, the maker said, of its ongoing recovery after emerging from bankruptcy nearly two years ago.

A rebound in the North American market helped fuel the earnings, though GM’s numbers also received a significant boost from China where it is now the largest manufacturer in the booming market.  Concessions from union workers played a significant role in improving the bottom line, with analysts saying GM now has a significant cost advantage over foreign-owned transplant assembly lines.

For the fourth quarter, GM reported net income of $510 million – after taking $400 million in charges for buying preferred stock held by the U.S. Treasury and other one-time expenses – which worked out to $0.31 a share.  Factoring out the one-time charges, GM would have earned $0.51 a share, slightly above the consensus on Wall Street.

For the full year, GM earned $2.89 a share on revenues of $135.6 billion.  During the fourth quarter, revenues reached $36.9 billion, which was also ahead of the $34.3 billion estimated by analysts tallied by FactSheet.

GM ran up more than $80 billion in losses, starting in 2005 and continuing through to its 2009 bankruptcy – from which it emerged only after receiving about $50 billion in federal assistance.  It has since paid off all its outstanding U.S. and Canadian government loans and last November’s initial public stock offering resulted in the sell-off of slightly less than half the federal stake in the automaker.

Click Here’s complete report on the GM earnings.

GM Will Apparently Put Diesel in Cruze

Small Chevy oil burner expected to be a 2.0-liter four cylinder.

by on Feb.24, 2011

Holden offers a diesel in its version of the Cruze sedan. A website says that GM is now preparing to bring the diesel to the U.S. market.

For years, executives for the Big Three automakers have said that there wasn’t a viable business case for a small diesel car in the U.S.

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Now it appears General Motors is planning to test the waters with a diesel slated for the 2013 Chevrolet Cruze.

GM Inside News quoted unnamed sources at the Lordstown, Ohio, assembly plant that produces the Cruze as saying that management had informed them that a diesel would be added to the Cruze lineup beginning next year.