With General Motors Chairman Jack Smith about to give up the chief executive duties in June and DaimlerChrysler Co-Chairman Bob Eaton retiring March 31, we posed a few questions to both.
First up Smith:
Q–When will we see the first fruits of your joint venture, reached last year with Toyota, to develop alternative fuel systems for vehicles and, perhaps, the vehicles themselves?
A–Too early to say. We’re focusing on fuel cells but I can’t talk about any other things we’re doing. We’ll have an update in a few months.
Q–What about reports GM and Toyota will build a RAV4-like small sport-ute at your NUMMI (New United Motor Manufacturing Inc.) joint-venture plant in California, as well as, maybe, a hybrid-like the Toyota Prius at the plant while dropping the Chevrolet Prizm built there to make room for new models?
A–I can’t comment on NUMMI.
Q–There have been reports that your engine-exchange pact with Honda, in which Honda supplies GM with V-6 engines and GM supplies Honda with 4-cylinder diesels from Isuzu, will put a Honda V-6 under the hood of the next-generation Cadillac Catera.
A–We haven’t made a final call on that V-6.
Q–John Smale, the outside director on the GM board who led the infamous 1992 coup that ousted Bob Stempel as chairman, said he’ll retire this year after the annual meeting in May. Is any other outside board member going to take over as watchdog of internal GM board members as well as the GM executive staff?
A–Nothing has been said about that.
Q–GM has said its production capacity at the end of 1999 was 48 percent trucks and 52 percent cars, versus 47 percent trucks/53 percent cars a year earlier. Still seeking ways to increase trucks because that’s where the highest profits are?
A–We plan to add significant truck capacity, using the plants we’ve got now without adding any bricks or mortar. But we have nothing to say about that now.
For the longer term, we’ll need to do a plant conversion (from cars to trucks), and studies are under way on that. But we have nothing to say about that, either.
Turning to Eaton:
Q–Can you elaborate on speculation over a pending DaimlerChrysler deal with Fiat or Peugeot?
A–No comment.
Q–Well, then, what about rumors DaimlerChrysler is interested in an acquisition to build a new small car that would affect production plans for the current subcompact Neon built in Belvidere?
A–We’re open to discussion about a new small car, but that car is for Europe and Asia, not for the U.S. We need a small, 1-liter city/urban vehicle in order to grow our business in Asia, Latin America and Europe. We wouldn’t market a 1-liter car in the U.S.
One approach would be to share a platform with an acquisition partner. We’re in a position to take that on. Last March, we couldn’t take on Nissan and its debt because we were involved with our merger with Daimler. But the merger is done now, and we’re hitting on all cylinders and could take on a partner.
Primary Focus: Jim O’Connor, president of Ford division, said the automaker has 190,000 orders for the compact Focus in the U.S. and 75,000 in Canada and Mexico.
“We are at maximum capacity with overtime on Focus. In January we raised the line speed to 74 cars an hour from 65 to get 35,000 more cars for the year. In its first three months on the market, Focus has gone from nothing to the No. 2 small car seller behind the Honda Civic. Escort was at 50 percent of Civic sales, Focus is at 95 percent,” O’Connor said.
Putting the brakes on: O’Connor said anti-lock brakes will be standard on all 2001 Ford Ranger pickups this fall and that a new, more powerful 4-cylinder will replace the 2.5-liter, 119-h.p. engine in Ranger in November.
All for 1: Why did GM come up with a display at the Chicago Auto Show with all its vehicles–except Saturn–together?
“Because historically our divisions competed against each other, and we have to act like one company,” said GM President Rick Wagoner.
Little incentive: The strong demand that the auto industry is experiencing results in little need for incentives or rebates to move popular hardware.
“I’d rather push product value than discounting. Our inventories are in good shape, but you always have to watch for a market slowdown and be prepared to react rather than dodge and weave,” said Martin Inglis, head of North America operations for Ford.
Inglis said the power adjustable brake/gas/accelerator pedals offered on the 2000 Ford Taurus will be added to other Ford cars soon because “people love them.”
Sonata preview?: Hyundai officials confided that the CrossTour concept at the auto show “provides us with ideas for the next-generation Sonata.” CrossTour is built off the Sonata platform with all-wheel-drive and a 2.7-liter V-6 engine.
Droptop dropped: Chevy insiders said it’s official: There won’t be a two-door Blazer convertible, planned for 2001.
GM’s consolidation of its compact sport-utility lineup, when the next-generation Blazer comes out for 2002, ruled out a convertible. As reported (Cars, Feb. 10) Chevrolet will continue to produce the two- and four-door Blazer in the 2001 model year and for an indefinite period when the redesigned next-generation Blazer arrives. But it may drop the two-door once production of the new four-door is up to capacity.
