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General Motors is forming an alliance with French carmaker Peugeot to help the company make progress in getting to a breakeven point in Europe. 

GM made a record profit last year, but it was no thanks to Europe, where the company lost $700 million.  

The limited alliance with Peugeot will involve the joint development of some car platforms and joint parts purchasing. 

The companies estimate it will save a total $2 billion within a few years.

GM CEO Dan Akerson says the two companies will continue to compete in other areas.

Transcript

STEVE INSKEEP, HOST:

General Motors made a record-breaking profit last year. And to date, taxpayers have recovered close to half the $50 billion federal investment in the company. So the auto bailout worked, right? Wrong, say Republican presidential candidates, who insist the bailout was a huge mistake.

DAVID GREENE, HOST:

Michigan Radio's Tracy Samilton reports.

General Motors posted a record profit of $7.6 billion in 2011, although its losses in Europe were very high -- $700 million.

In a conference call with analysts, GM CEO Dan Akerson  called Europe a "rather challenging market, not only for GM and Opel, but also for our competition."

GM also lost $100 million in South America.

Most of the money GM made came from sales in North America.  GM made $7.2 billion before taxes in the region.

GM plans to make major structural changes in Europe to reduce its persistent losses there.  

(photo by Steve Carmody/Michigan Radio)

Saturday marks the 75th anniversary of the end of the Flint Sit Down Strike.   

Hundreds of UAW members gathered in Flint today to commemorate the pivotal moment in the history of the union movement.   

Union members honored in song the six surviving sit down strikers and women’s brigade members who gathered to mark the anniversary of the strike that many say legitimized the United Auto Workers union.

Art Reyes is the president of UAW local 651.   He says the surviving sit-down strikers are an inspiration.

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Candidates on both sides of the political fence, especially during this presidential election cycle,  have been trying to make hay out of the U.S. government bailouts of Chrysler and GM.  

At a speech to the National Automobile Dealers Association convention yesterday, former President George W. Bush said the reality of the severe economic downturn led him to his decision to begin the bailouts of GM and Chrysler.

From Bloomberg News:

“I didn’t want there to be 21 percent unemployment,” Bush said in a speech yesterday to cap the annual National Automobile Dealers Association convention, attended by more than 20,000 people. “I didn’t want to gamble. I didn’t want history to look back and say, ‘Bush could have done something but chose not to do it.’ And so I said, ‘no depression.’” 

Bloomberg reports the Bush administration loaned GM and Chrysler $17.4 billion "before Barack Obama’s administration expanded the rescue of the companies to $62 billion."

The Detroit Free Press reports that Bush said he believed GM and Chrysler were mismanaged and should pay for their own problems...

"But sometimes circumstances get in the way of philosophy," Bush said. "I would make the same decision again."

Chrysler repaid its loans last year, and GM has repaid around $23 billion, but the U.S. Government still holds around a quarter of GM stock.

General Motors reported U.S. car sales in January were down 6% from the same month a year ago.

But GM's head of U.S. Sales, Don Johnson, says comparing the two months is tough.  That's because the Detroit automaker boosted sales significantly last January with incentives. 

Johnson says the good news is GM increased its market share in the U.S. last month, compared to December.  GM had about a 19% market share last month.

Johnson says it's not possible to predict gasoline prices, but for most of 2012, he thinks they'll stay under $4.00 a gallon.

Richardo Giaviti / Flickr

President Barack Obama is expected to visit the Washington Auto Show on Tuesday.

Obama sometimes calls his decision to rescue General Motors and Chrysler a tough choice that saved jobs in an important industry.

The auto show will give him another forum to talk about GM and Chrysler, along with the administration's attention to manufacturers and efforts to boost fuel efficiency standards.

The president's advisers view the auto bailout as a potential point of contrast with Republican Mitt Romney, who opposed Obama's decision to pour billions of dollars into the companies.

During his State of the Union address last week, Obama said the auto industry has hired tens of thousands of workers, and he predicted the Detroit turnaround could take root elsewhere.

General Motors North American President Mark Reuss weighed in on his boss's testimony Wednesday before a Congressional subcommittee. 

The hearing was entitled, "Volt vehicle fire: What did NHTSA know, and when did they know it?"

Reuss says, "It was a huge opportunity for us, yesterday, and the whole company is proud of Dan [Akerson - GM's CEO].  But more importantly it gives the whole country a look into what this company can be."

General Motors CEO Dan Akerson strongly defended the safety of the Chevy Volt during his testimony before a House subcommittee Wednesday.    

The hearing was entitled "Volt vehicle fire:  What did NHTSA know, and when did they know it?"   

Last June, a fire broke out in a Chevy Volt, three weeks after it had been damaged in a crash test.

The National Highway Traffic Safety Administration opened an official investigation into the fire risk of the Volt in late November, after performing two other tests on the Volt's battery alone.

(photo by Steve Carmody/Michigan Radio)

The government ended its safety investigation into the Chevrolet Volt on Friday after concluding that the Volt and other electric cars don't pose a greater fire risk than gasoline-powered cars.

The agency began studying the Volt last June after a fire broke out in one of the cars three weeks after it was crashed as part of safety testing. Two other fires occurred later related to separate safety tests, and NHTSA opened an official investigation into the vehicle on Nov. 25.

The agency and General Motors Co. know of no fires in real-world crashes.

user paul (dex) / Flickr

For those of you keeping score at home, it's GM 9,030,000 to Toyota's 7,900,000 for 2011.

Those are "around" numbers for the number of vehicles sold in 2011 by the automakers from the Associated Press.

GM has retaken a crown it owned for 77 years before Toyota snatched it away in 2008.

Since that time, Volkswagen has been an up and comer as well. That company is the no. 2 automaker. It sold around 8,160,000 vehicles last year.

But some argue there's some fuzzy math going on to make GM the "top automaker" in the world.

More from the Associated Press:

Some analysts have said that VW is the world's biggest automaker because GM's figures include vehicles made by its Wuling joint venture in China. Many don't count Wuling because GM doesn't have controlling interest in the company, but GM includes it in global sales figures.

Excluding Wuling, GM would have been topped by Volkswagen.

Being the world's top-selling automaker doesn't mean much for the bottom line. But GM retaking the title is an example of how far the company has come since its 2009 bankruptcy.

Bloomberg Business Week's Tim Higgins quotes one analyst saying the top automaker crown means "bragging rights" and might help with stock prices.

Higgins writes GM's stock did go up with the news, but the stock would have to go up significantly before the U.S. government would break even on its investment:

GM rose 0.5 percent to $24.63 at 11:26 a.m. New York time.

The U.S. government still owns almost a third of GM. The government would have to sell its stake at an average of $53 a share to break even. GM earned $6.17 billion in 2010 and $8.47 billion in the first nine months of last year.

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Last month, Michigan Radio's Steve Carmody visited Flint to report on the 75th anniversary of the start of the Flint sit down strike, a work stoppage at multiple GM facilities beginning in 1936, which Carmody says was "pivotal to the birth of the United Auto Workers," and had profound implications for American organized labor in general.

Carmody writes:

GM unveiled the Buick Encore, the latest all-new Buick, at the Detroit Auto Show Tuesday.

The Encore rounds out Buick’s revamped line-up, which also includes the Verano, LaCrosse, and Enclave.

GM is trying hard to ditch Buick’s “older” image and market the brand to younger customers.

GM Vice President for design Ed Wellburn said the Encore will increase Buick’s appeal to younger buyers—and women—because it’s part of a trend toward what he calls “premium small SUVs.”

“This is really on the leading edge of that trend,” Wellburn said. “We firmly believe there are great opportunities there, and it expands the Buick portfolio.”

The Encore will go on sale in early 2013. The car will be manufactured in South Korea—a nod to the fact that GM plans to market the car heavily in China—where Buick is a popular brand--as well as North America.

“We’re a global company with a global footprint,” said Roger McCormack, Buick’s product marketing director. “When you look at the picture in total, this was the right [manufacturing] decision for us.”

Mercedes Mejia/Michigan Radio

Detroit automakers are introducing cars at this year’s Detroit Auto Show that could help them make gains against foreign-based competitors. 

Ford Motor Company is unveiling its new Fusion, hoping to topple the traditional midsize sedan leaders, the Toyota Camry and Honda Accord.  

The Fusion will also come in hybrid and plug-in hybrid versions, with the plug-in getting the equivalent of 100 miles per gallon.  

Ford CEO Alan Mulally says the company sold a record number of Fusions in 2011 -

"It had its best sales year ever," Mulally told reporters after revealing the Fusion at Joe Louis Arena.  "So the new Fusion is going to build on that success and be very, very popular with consumers."

But Ford Executive Chairman, Bill Ford, Jr., says the company is not going to pursue an increase in market share for the coveted midsize sedan segment just for the sake of market share.

"We are not going to play that volume game," he says.  "If it happens organically, great, but we don’t have some magic number on the wall that we’re all pushing toward."

Meanwhile, Cadillac on Sunday introduced a new small luxury vehicle, the ATS, to compete against BMW and Mercedes Benz.   GM North American President Mark Reuss says the car is a "true driver's car," and can compete head to head with the Mercedes Benz C class and the BMW 3 series.

BMW North America head Ludwig Willisch says a new competitor is always a concern, but he's confident that upgrades to the new 3-series will enable the company to keep its leadership position.

For its part, Chrysler introduced a new small car called the Dodge Dart.  The car will compete against small cars made both by its Detroit rivals and foreign-based companies including Toyota, Honda and Hyundai.

user citizenofthedeep / creative commons

In her post on Forbes, auto writer Joann Muller says the idea that Chevy Volt batteries are unsafe is pure poppycock... balderdash... hooey... or as she puts it:

Hogwash. GM and its battery partner, LG Chem, have tortured that battery to death. They’ve abused it, mutilated it, jarred it, twisted it, and even punctured it with nails. There’s nothing wrong with the Volt or its battery that can’t be fixed with a couple of minor tweaks.

The minor tweaks are coming after a government safety test found that the batteries can catch fire seven days to several weeks after a crash. No fires were reported in real-world circumstances.

The company announced today that it will add parts to ensure the batteries will not catch fire.

Muller reports that the government has crashed a Volt with the new parts - no fire yet - but they'll give it another week to see if one starts up:

In a statement, NHTSA said  it crashed a Volt retrofitted with GM’s newly designed steel reinforcement device in a side-pole impact test on December 22. The results of that crash test showed no intrusion into the vehicle’s battery compartment, and no coolant leakage was apparent. As a precaution, NHTSA has monitored the crashed vehicle since the test and will continue to do so for one more week. But the agency said the preliminary results of the crash test indicate that GM’s fix should solve the problem.

General Motors says it will modify all of its Volt models. The announcement comes after federal side-crash tests resulted in three battery fires.

The fires occurred up to three weeks after the tests when coolant leaked into the cars' batteries.

There has been no recall of  GM’s electric Volt, but the automaker is voluntarily asking owners to bring their cars in for a fix.

"We've added some structure that allows the load to be spread, so it doesn't cause intrusion into the battery pack or coolant leak," says Mary Barra,  GM’s senior vice president of Global Product Development.

GM sold about 8,000 Volts in the U.S. over the past two years. No fires have been reported by customers.

Volt owners will be notified when dealers get the repair parts – probably in February. GM says the modification should not take more than a day and a loaner car will be provided.

U.S. vehicle sales continue to rise

Jan 4, 2012

Consumers appear to be more confident in the economy, and it showed in the salesrooms of American car companies last year.  

Chrysler saw the biggest improvement, with sales up 26 percent over 2010.

The company says its Jeep Wrangler and Chrysler 200 sedan were the most popular of the 16 new or revamped models it rolled out.

Ford sales rose 11 percent, driven by demand for its trucks and SUVs.

General Motors reports a 14 percent increase for 2010 bolstered by its passenger car sales, including the new Cruze and Sonic.

Don Johnson is GM’s vice president for U.S. Sales Operations. He says the company predicts more growth next year, but is keeping an eye out for bumps in the road:

"Clearly we have to, as always, keep our eye on oil and gas prices, and on the political environment as we prepare for an election in November.”

Altogether, U.S. automakers sold nearly 6 million vehicles in 2011.

(photo by Steve Carmody/Michigan Radio)

Today is the 75th anniversary of one of the key moments in the history of organized labor in the United States: The beginning of the Flint Sit Down Strike.   

The Flint Sit-Down Strike was pivotal to the birth of the United Auto Workers.   

Three-quarters of a century later the echoes of the event still resonate.  

user facemepls / Flickr

Saab filed for bankruptcy in Sweden on Monday after its former owner, General Motors, opposed a plan that could have bailed the company out. 

Saab developed severe cash flow problems almost immediately after GM sold it to a Dutch company, Spyker. Saab had to stop making cars this year while it sought new investors. 

The company found a buyer in China, but GM  said no to the deal.   

Selling the company triggered contract clauses that required GM to sign off on transfers of technology used in many Saab vehicles.

A GM spokesman said the company didn't want to lose control of its technology and allow Saab to become a competitor's shortcut into the thriving auto industry in China.

AutoPacific analyst Dave Sullivan says there's now little hope the quirky little brand can be saved.  

"[Saab] was a vehicle that could easily be seen on the road as a Saab," says Sullivan. "It could never be mistaken for anything else, and I think we’re losing an iconic design."

Saab sold only a few thousand cars in the U.S. last year.

© GM Company

UAW members in Lansing voted this week to authorize a strike at a General Motors plant.  

Local 602 reported tonight that 86 percent of its members voted to authorize a strike at GM'S Lansing Delta Township plant.

Union leaders say they hope the vote will encourage both sides back to the bargaining table.

The union and GM have been unable to reach an agreement on several workplace issues.

The plant produces the Chevrolet Traverse, GMC Acadia and Buick Enclave.

United Auto Workers members are voting on whether to authorize a strike at General Motors’ Lansing Delta Township plant.   The vote centers on several workplace issues.   

The Delta Township plant produces the Chevrolet Traverse, GMC Acadia and Buick Enclave.  Tracy Handler is an analyst with IHS Global Insight.    She says if UAW members strike at the Lansing plant, the effect would not be immediate on GM.   

staff / GM MEDIA

NEW YORK (AP) - The top executive at General Motors says the company will buy back Chevrolet Volts from any owner who is afraid the electric cars will catch fire.

CEO Daniel Akerson told The Associated Press Thursday that the cars are safe. But he says GM would buy back the vehicles to keep customers happy. Three fires have broken out in Volts after side-impact crash tests done by a federal safety agency. The fires happened seven days to three weeks after the tests.

Akerson also says that GM could recall more than 6,000 Volts now on U.S. roads, if necessary, and fix them once the company and safety regulators figure out what caused the fires.

GM says no Volts involved in real-world crashes have caught fire.

Three big, new investments by automakers in one Ohio city are raising hopes for a revived economy. Chrysler and General Motors have promised to spend more than $800 million on retooling and expanding their factories in Toledo.

These moves announced in recent months will create at least 1,400 jobs and keep thousands more. Parts suppliers also are expected to add more jobs in and around Toledo.

Chrysler announced plans on Wednesday to build a new Jeep SUV at its Toledo assembly plant while adding 1,100 jobs. It also hinted that more work could be coming.

That's why Toledo Mayor Mike Bell calls the news "the equivalent of a blood transfusion for our city."

Associated Press / Associated Press

Former GM Chairman John Smale led the company from late 1992 until the end of 1995. He died today in Cincinnati at the age of 84. He was a board member of the automaker for more than two decades starting in  1982.

Smale also led Cincinnati based Procter & Gamble from 1981 to 1990.

The Canadian with German ancestry graduated from Miami University (Ohio) in 1949. He joined P&G in 1952, working for what was then called the toilet goods division. He rose through the company, becoming president in charge of all U.S. operations in 1974 and chief executive in 1981. He added the chairmanship in 1986.

During his tenure, Smale moved P&G businesses into new markets in huge developing countries such as China, setting the stage for P&G's rapid growth in Asia in recent years. P&G also acquired Richardson-Vicks, which broadened the P&G portfolio to include Pantene shampoo, Olay skin cream and Vicks cough medicines, which are major brands today. In a smaller acquisition, P&G obtained the CoverGirl makeup brand that also is still growing.

At GM, Smale help change the structure of the automaker's management and put a renewed focus on customers.

automotiveauto.info

The heads of two of Detroit’s car companies say they’re concerned about the debt crisis in Europe. 

European consumers are pulling back from buying cars because of fears about the Euro and the economy.   

Fiat and Chrysler CEO Sergio Marchionne on Wednesday said he’s hopeful the new leadership in Italy will help turn things around in that country.  But he says car sales in Europe could worsen through next year.   

At the Detroit Economic Club Thursday, GM CEO Dan Akerson said the crisis could damage more than car sales.  But he’s hopeful the U.S. economy has become more resilient.

"Could the United States withstand a recession in Europe?" he asked rhetorically.  "I think it could. "

Ford CEO Alan Mulally earlier this month took the most optimistic view, saying he expects some global economic growth next year, despite sovereign debt concerns.

General Motors made $1.7 billion in the third quarter of this year.

That's down from $2 billion in the same period of 2010.

Financial turmoil in Europe contributed to GM's continued losses in Europe, although GM did cut those losses in half compared to last year, to $300 million.

GM is also not doing particularly well in South America.  The company broke even in that region.  GM officials say that's due to increased competition in the region and an aging lineup there.

The Associated Press reports that an industrial contractor has bought a former General Motors facility in Pontiac with plans to use the 6-acre property for an expansion.

More from a Revitalizing Auto Communities Environmental Response (RACER) Trust press release:

An industrial contracting company has purchased the former GM ACG Penske facility on Oakland Avenue, with plans to expand its business at the six-acre property.

The RACER Trust sold the property, which includes a 32,000-square-foot building with multiple truck bays, to Lee Contracting, headquartered across the street from the ACG Penske facility, at 675 Oakland Ave.

Lee Contracting Founder and President Ed Lee said he plans to expand his more than 200-employee company, and the former ACG Penske property provides a perfect fit. “This was a great opportunity to build upon our business right here in Michigan,” he said. “Having this great site right across from our current facility provides us with a base to continue expanding the business.”

Lee Contracting is a single-source contractor specializing in complete turnkey solutions for industrial and manufacturing clients.

Terms of the sale were not disclosed.

General Motors officials say the company will invest $215 million in the GM Saginaw Metal Casting Operation to tool the plant to build components for future GM vehicles. 

The plant makes engine blocks and cylinder heads for GM vehicles, including the Buick LaCrosse and Chevy Malibu.

GM says the investment will create or maintain 275 jobs at the plant, which currently employs 630 people.

Later today, Nexteer is expected to announce a large capital investment in its Saginaw operations. 

Governor Rick Snyder will attend both events today.

General Motors officials said they will "create or retain" 418 jobs with a $325 million investment at a suburban Detroit transmission plant. The company says it will invest "in tools and equipment to support production of future electric vehicle components."

So which is it? Are they creating or retaining the jobs?

According this report in Crain's Detroit Business, 360 jobs will be created at the plant in Warren, Michigan as a result of the new UAW contract:

The company would not say how many of the 418 jobs will be new positions. But a summary of GM’s new four-year contract with the UAW said 360 jobs will be added at the plant for a new transmission that originally was to have been built in Mexico. The union said that the jobs were brought to the U.S. as part of the new contract.

At this point, GM is not revealing the timing for the project.

According to GM, 679 current employees at  the plant in Warren make transmissions for the Chevrolet Traverse, Buick Enclave, GMC Acadia, and the Chevrolet Malibu sedan.

From a GM press release:

“This investment in the future recognizes the excellent work force and operation of this plant,” said GM Manufacturing Manager Gerald Johnson. “While we aren’t sharing many details about this product, I can tell you that this investment demonstrates how GM, working with our UAW partners, continues to innovate and bring new electrification solutions to our customers.”

The 2.1 million square-foot plant, equivalent to the area of 15 city blocks, produced more than 338,000 transmissions in 2010.

“We are very proud of the membership of UAW Local 909 whose hard work and dedication to building quality products is why this new electric drive unit module is being built in the United States,” said Joe Ashton, UAW vice president representing the GM Department.  “These good paying, middle class jobs are very important for the State of Michigan and the Metro Detroit area.  It is the UAW’s goal to increase employment at GM and show the world that we can compete with anyone.”

President Barack Obama
White House

President Obama will be in southeast Michigan today to promote a new  free trade agreement with South Korea.  President Obama is scheduled to tour General Motor’s assembly plant in Lake Orion.   South Korea’s president will accompany Obama. 

Congress this week approved a new free trade agreement with South Korea.  South Korea is the world’s 13th largest economy.  

The free trade pact is the largest such deal since the North American Free Trade Agreement with Canada and Mexico in the mid-90’s. 

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