Technology StocksAmerican Automobile Industry: Can it survive?

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To: robert b furman who wrote (363)6/14/2011 4:16:37 PM
From: Don Hurst
   of 431
Bob, I just saw that Ford will invest over $1 Bn into their Spanish plant near Valencia at the same time GM is again "rumored" to have Opel up for sale even while they seem to be making significant use of Opel designs.

Strange to me that the two seem to be so divergent in Europe...any thoughts?

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To: Don Hurst who wrote (387)6/15/2011 10:06:02 AM
From: robert b furman
1 Recommendation   of 431
Not familiar with European operation.

They do use a lot of euro plans and designs.

Whenever you see a car that fills up on the drivers side vs passenger side - it is a euro gas tank design.


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To: robert b furman who wrote (388)6/15/2011 4:53:22 PM
From: Don Hurst
   of 431
>>" Whenever you see a car that fills up on the drivers side vs passenger side-it is a euro gas tank design. "<<

Euro gas tank fill on the passenger side, don't they?...but I didn't know that was Euro specific.

I would be quite surprised if GM sells Opel but apparently they now market US models such as Chevy in Europe when formerly it was all Opel so the marketing would continue but with little or no Euro mfg. Ford seems to be doing the opposite by increasing Euro mfg.

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To: stockman_scott who wrote (383)6/22/2011 7:49:17 AM
From: brazilo33
   of 431
I suggest that Americans keep their low gas taxes because that is the only reaasons why the US has cheaper gas. European gas is to much higher because of taxes

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To: stockman_scott who wrote (383)7/21/2011 10:04:56 PM
From: Glenn Petersen
1 Recommendation   of 431
Fiat Acquires Majority Share of Chrysler

Wall Street Journal
JULY 22, 2011

Italian auto maker Fiat SpA officially became Chrysler Group LLC's majority owner on Thursday, clearing the way for a complete restructuring of Chrysler's board of directors and a further merger of the two companies' management.

Fiat on Thursday reached a deal to pay the Canadian government $140 million for its small stake in Chrysler, and completed a previously announced deal to purchase the U.S. government's larger stake in the auto maker. The two moves increased Fiat's holding in Chrysler to 53.5% from 46%.

Sergio Marchionne, who serves as chief executive of Fiat and Chrysler, is likely to move quickly to reorganize Chrysler's board and replace its five directors who were appointed by the two governments. The government appointees include Chairman C. Robert Kidder, Douglas Steenland, Robert Thompson and Scott Stuart, each appointed by the U.S.; and George F.J. Gosbee, who represents Canada's interests.

Chrysler's current nine-member board was appointed after the auto maker exited bankruptcy in 2009 by the then stakeholders in the company which included Fiat, the U.S. and Canadian governments and the United Auto Workers retiree health-care trust fund.

A Chrysler spokesman declined to comment.

Separately, Mr. Marchionne has already begun picking executives who will serve on a single management team as part of a bid to merge the two companies into a single, global auto maker. Currently, each auto maker has its own executive team that reports directly to Mr. Marchionne.

Details of the new management structure are likely to be outlined during Chrysler's quarterly conference call on Tuesday. Fiat has said it will consolidate Chrysler's earnings into its own finances and will report those when it releases results.

Canadian Finance Minister Jim Flaherty said the governments of Canada and Ontario will receive a total of $140 million, including $125 million for their combined 1.6% interests in Chrysler, and an additional $15 million as a portion of proceeds arising from the assignment to Fiat of a share-agreement between the U.S. Treasury and the UAW trust.

Ontario will get one-third of the proceeds. Provincial Finance Minister Dwight Duncan said the province will use the funds for deficit reduction.

The U.S. Treasury said Fiat paid $500 million for its 98,461 shares, or 6% fully diluted equity interest. The company also paid an additional $60 million for Treasury's rights to purchase the shares owned by the United Auto Workers health care trust fund. The stake sale was announced earlier this year.

The UAW retiree trust fund is the only remaining shareholder with a 44.7% stake or 41.5% on a fully diluted basis. Mr. Marchionne has talked about working a deal to buy the fund's shares, eliminating a need to take Chrysler public.

Write to Jeff Bennett at and Josh Mitchell at

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To: stockman_scott who wrote (383)7/22/2011 9:01:05 PM
From: Glenn Petersen
1 Recommendation   of 431
Wheeling and Dealing

New York Times
July 20, 2011

DETROIT — American carmakers and the United Automobile Workers union open contract talks next week with a common task of preserving the comeback of an industry that was on the verge of collapse just two years ago.

But their cooperation will be put to the test as the sides square off over how to divide the profits of Detroit’s unexpectedly swift revival.

After a period of plunging sales, bankruptcies and government bailouts, the union is hoping to regain some of its lost jobs, reopen closed factories, and increase the pay of its 111,000 members, some of whom are being paid half as much for entry-level jobs as other workers under a two-tier wage arrangement.

But those goals run against the priorities of Detroit’s Big Three automakers, who want to hold the line on costs and further close the gap in productivity with foreign-owned factories in the United States, which employ much cheaper nonunion workers.

And while contract negotiations are always prickly, this round has a particularly prominent backdrop: the long shadow of the Obama administration, which bailed out both General Motors and Chrysler and shepherded the automakers through Chapter 11.

As part of the bailouts, the U.A.W. agreed to no-strike clauses at both companies and to submit to arbitration in the event that a contract could not be reached.

That leaves Ford, the most successful of the three, as the only possible strike target should the talks fall apart. But the U.A.W. benefited greatly from the federal intervention, and Ford has been hailed by consumers for surviving the recession without financial help from taxpayers.

For the union to strike Ford or enter a contentious arbitration process could reignite debate over the bailouts and prove politically embarrassing to President Obama as he readies next year’s re-election campaign.

Bob King, the union’s president, said in an interview that he was “morally and legally” bound to get the best deal possible for his membership, regardless of the political consequences. “But if we end up with a strike or arbitration,” he acknowledged, “I’d feel like I failed in many ways.”

The union’s four-year contracts with G.M., Ford and Chrysler expire in mid-September. Indications are that the U.A.W. will be aggressively seeking better profit-sharing, job guarantees, and wage increases for lower-paid, entry-level workers.

“Our members have sacrificed a lot,” Mr. King said. “We’re trying to figure out a path that gives members more income but doesn’t disadvantage the companies.”

All three automakers are making money and expanding sales. But they are loath to do anything that hurts their newfound competitiveness or adds costs to their streamlined manufacturing operations. The Big Three earned nearly $6 billion in combined profits during the first quarter of this year, and paid sizable profit-sharing checks this spring based on their 2010 results.

“We all know that there are things we can’t do to go back to how we were,” said Cathy Clegg, head of G.M. labor relations, during an appearance Monday at a truck plant in Flint, Mich. “We need to see a pretty healthy market recovery before we start turning factories back on.”

All three companies have drastically cut production and jobs in recent years to better match their smaller market shares. The U.A.W. currently has less than half the number of employees at G.M., Ford and Chrysler than just five years ago.

The pain of losing so many jobs is still fresh in the minds of the surviving workers, said Mr. King, who was elected president last year after previously running the U.A.W.’s Ford division.

“They want stability,” he said. “They want to know they’ll be working next week and next year, and that they will be able to send their kids to college.”

But while preserving jobs is paramount, Mr. King said that workers deserved a bigger share of the economic benefits of Detroit’s turnaround.

While Mr. King does not expect across-the-board wage increases, he said the automakers should improve their profit-sharing formulas, something some auto executives have indicated a willingness to consider. He added that new entry-level workers, who are paid about $15 an hour compared with $28 for regular U.A.W. members, deserve pay increases in the new contract.

“I don’t think you should be working in the auto industry at poverty-level wages when the companies are doing well,” he said.

In the last negotiations in 2007, the companies successfully removed retiree health care costs from their balance sheets by financing union-run trusts. However, in these talks Mr. King vowed to fight any efforts by the automakers to trim the medical coverage and other benefits of active workers.

“There is no justification for any concessions in this round of bargaining,” he said. “That is just not going to happen.”

Detroit will be looking for ways to shrink the cost gap between U.A.W. workers and nonunion employees of American plants owned by Toyota, Hyundai and other foreign car companies.

The disparity is less than in previous years. In 2010, the average hourly labor cost for a union worker ranged from $58 at Ford to $49 at Chrysler. That compares with about $55 at Toyota and $44 at Hyundai, according to the Center for Automotive Research in Ann Arbor, Mich.

The automakers are not commenting publicly on how they expect to lower their costs. Industry experts say that the companies want more flexibility on work rules, job assignments and production schedules.

The companies will resist pressure from the union to reopen closed plants that do not have new products on the way.

“Right now the market won’t call for that,” said Art Schwartz, a former G.M. labor negotiator who is now president of the firm Labor and Economics Associates. “They are not going to open a plant up and lose money.”

The no-strike clauses and arbitration requirements at G.M. and Chrysler could complicate the negotiations. Ford could be vulnerable because it could agree to a deal with the U.A.W. that might not stand up to arbitration at one of the other companies.

The tough times in recent years do appear to have produced an ongoing constructive dialogue between the companies and their union. Mr. King and company executives speak proudly of their regular meetings to discuss topics like vehicle quality and broader issues like new fuel economy regulations.

“It’s more a problem-solving relationship rather than who is right and who is wrong,” he said. “You know, we’re not out of the woods yet.”

And although the automotive market has rebounded somewhat and Detroit is earning profits again, both the union and the car companies are painfully aware of how fragile their recovery is. “This is not the time to get greedy on either side,” Mr. Schwartz said.

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From: TimF7/28/2011 6:57:22 PM
1 Recommendation   of 431
GM's Diseconomies of Scale GMInsideNews says that GM's billion-dollar Alpha chassis design is in deep trouble. Mickey Kaus summarizes:

Alpha is the latest American attempt to compete with the BMW 3-series. It cost a billion bucks. But thanks to classic bureaucratic product-bloat-familiar to students of the F-111 fighter and Microsoft VISTA-the supposedly small and sporty chassis has locked in a "sub-optimal geometry" on the front suspension (which GM is reportedly trying to mask instead of fixing) and is hundreds of pounds overweight. ... There's a reason some companies go bankrupt, you know. And corporate cultures are hard to change. ... Edward Niedermeyer of The Truth About Cars adds:
Now, class, if you were developing a BMW 3-Series competitor, how important would the issues of weight and front suspension geometry be? Very important? Sort of important? Existentially important? Meanwhile, what about AWD? How important would that be? GMI may be reminded of the Sigma's development, but GM's history is rife with vehicles that started with a bold, simple vision, only to be re-engineered into mediocrity. A line of driver-oriented, four-cylinder-only, rear-drive small luxury cars is an intimidating step to make... but it could have been distinct, downright unique. And it would have easily handled the CAFE issue that Lutz worried about as ATS development was beginning in earnest in 2008. Heck, BMW is putting a three-banger in its next-gen Dreier... so why was Cadillac so worried about bigger engines and AWD, while glossing over the "locked-in" sub-optimal front suspension?

Kaus adds the obligatory anti-union rant. I'll add the obligatory anti-corporate-conglomerate rant, which is, I think, a big part of the problem here.

Don't get me wrong: economies of scale are great stuff. But the corporate relationship with economies of scale is too often like a fourteen year old boy's relationship with cologne, or a hipster's relationship with hot sauce: if a dash is delightful, five dashes must be utter heaven. They end up trying to put the damn stuff on everything.

Re-using parts and tools for different marques is the benefit of being a big car company. But taken too far, it is also a drawback. It is very cheap to take a single chassis and drop every car you want to make on top of it. It is also very stupid, because you end up with a bunch of poorly differentiated products, none of which are best in class. Now, who does that description remind me of? Just give me a minute and I'm sure it will come to me . . .

Many companies face this temptation, and the bigger they get, the more tempting it is. But at the point where you're letting Cadillac load down your 3-series competitor with extra weight and a problem suspension, because it's cheaper than having them develop their own damn chassis . . . well, you're showing signs of terminal Conglomerate Disease.

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From: TimF8/3/2011 10:59:41 AM
2 Recommendations   of 431
Ford's brilliant bailout move may end up hurting
By Doron Levin
August 2, 2011: 12:20 PM ET

FORTUNE -- Ford famously avoided the taint of government bailout by heavily mortgaging itself in November 2006 -- down to its iconic Blue Oval logo -- before global credit markets seized. And the American icon has seemed to stay ahead of hometown rivals Chrysler and General Motors ever since.

Alan Mulally, CEO since 2006, has pulled a deft series of maneuvers destined to make for closely scrutinized B-school case studies. He shutdown or sold money-losing brands like Mercury and Jaguar. He saved the well-known Taurus badge and introduced a raft of hot-selling small cars, steering the company away from its overreliance on inefficient, truck-like vehicles. He even managed to resurrect the once popular but accident-prone Explorer as a safe, gas-sipping crossover. On July 26, Ford (F, Fortune 500) announced that revenue jumped 13% to $35.5 billion in the second quarter, as the number of vehicles sold globally rose 7% and, crucially, prices increased.

But all that success may now bring Ford some serious pain. The Big Three are hurtling towards a September 14 contract expiration with the United Auto Workers (UAW). For the first time, GM (GM, Fortune 500) and Chrysler are protected against UAW strikes thanks to agreements stemming from the government's $100 billion bailout, bankruptcy and reorganization of the two automakers in 2009. Ford is not. (Its union workers rejected a ballot initiative granting it a similar exemption the same year.)

That puts Ford at center stage of a quickly unfolding drama where -- for once -- it is significantly disadvantaged compared to its rivals. Ford wants to put itself in a position to capitalize on hard-won gains as GM and Chrysler got back on their feet. The UAW, meanwhile, wants to reverse its diminished role in the U.S. auto industry. Ford is the one company with which a UAW cowed since 2009 can still play hardball.

"Ford is the most likely to get whacked, because Ford is doing the best of the three companies," says a U.S.-based executive of a foreign automaker. "Mulally got the fattest pay package. And don't forget, the government saved Chrysler and GM, in part for the sake of the union, so it would be ungrateful, if not incredibly self-destructive, for UAW to put the squeeze on those two."

Bob King, UAW president, presides over a labor union that's shrunk to a third of its historic size. He has few prospects unless he can manage to organize one or more of the transplant manufacturers that are clustered mostly in right-to-work states across the southern U.S. In just the past five years, Ford's UAW work force alone has declined to about 41,000 from about 100,000.

Volkswagen AG is the latest foreign automaker to open up shop in U.S., earlier this year in Chattanooga, Tennessee. VW, like BMW and Hyundai, pay smaller salaries and have a fraction of the labor costs. But VW's German plants are organized by the metalworkers union, so the UAW may view that relationship as a wedge that could help it gain recognition in Tennessee.

An acrimonious UAW strike against Ford -- the first in more than 30 years -- would be anathema to its plans in the south. More than 80,000 workers applied for a few thousand VW jobs in Chattanooga; the winners in that lottery aren't likely to be interested in joining a union, much less one party to a recent work stoppage. Still, King and his team of UAW negotiators must bring some increase in pay or benefits to his members -- otherwise they may ask themselves why they are they paying union dues each month.

Ford, which declined to comment on the record for this story, is thought to be seeking a greater share of health-care costs be paid by UAW workers and their families. According to the automaker's own data, UAW members pay about 5 percent of the cost of health care, compared to 30 percent of the cost paid by Ford's salaried staff.

In return, Ford is willing to improve profit-sharing, making it simpler and more dependent on factors like quality and workplace efficiency -- rather than purely on how much the company earns. Ford says its labor costs, including benefits, are about $58 an hour, 16 percent more than the going rate at Toyota's and other U.S. transplants.

Aaron Bragman, an analyst for IHS Global Insight in Northville, Michigan, notes that "Ford can maintain what it's got in these negotiations, but it can't win anything new. Even maintaining what it's got will be a win. I'm not sure the UAW leadership is bent on a strike. If it happens, it probably will be short and symbolic."

The complications could begin close to contract expiration in September if an impasse at GM and Chrysler results in binding arbitration, the resolution method agreed upon by the UAW in 2009. An arbitrator could impose a solution on rivals that wouldn't be acceptable to Ford. The union then might have to risk a strike or accept an end to the so-called "pattern" contracts designed to keep labor-cost parity among Detroit automakers. And that could put Ford in the toughest spot it's been in since 2006.

On balance, even a bloody UAW strike would be better for shareholders -- especially the Ford family -- than bankruptcy and recapitalization under the thumb of the U.S. Treasury Department would have been. Ford continues to benefit with consumers who prefer to buy vehicles that aren't perceived to have been created as a result of Washington D.C. tinkering. Ford has performed heroically, fighting back from the brink on its own steam. Now the law of unintended consequences could bite, as the company becomes a potential punching bag instead of Chrysler or GM. It took some time, but Ford may have finally found the down side of going it alone.

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To: stockman_scott who wrote (383)9/12/2011 2:45:28 PM
From: Glenn Petersen
   of 431
Detroit Sets Its Future on a Foundation of Two-Tier Wages

New York Times
September 12, 2011

DETROIT — They are a cornerstone of Chrysler’s unlikely comeback: 900 employees turning out a Jeep Grand Cherokee S.U.V. every 48 seconds of the working day at an assembly plant here.

Nothing distinguishes them from the other workers at the Jefferson North plant, except their paychecks.

The newest Chrysler workers earn about $14 an hour, compared with double that amount for longtime employees on the same shift. With the economy slumping and job creation once again a pressing issue in the White House and Congress, the advent of a two-tier wage system in Detroit is spiking employment for one of the country’s most important manufacturing industries.

For many, the opportunity for steady employment is welcome, even at a lower wage.

“Everybody is appreciative of a job and glad to be working,” said Derrick Chatman, who makes $14.65 an hour putting tires on Jeeps after being laid off at Home Depot, working odd construction jobs and collecting unemployment.

What was once seen as a desperate move to prop up the struggling auto industry is now considered an integral part of its future. The demand for $14-an-hour manufacturing jobs is providing Detroit’s Big Three automakers with a ready pool of eager new employees. Last year, Chrysler was flooded with inquiries about the jobs here, and it froze the list after receiving 10,000 applications.

The companies say the two-tier wages are paying off. Despite the disparity, there is no appreciable difference in the Grand Cherokees produced on the shift dominated since last fall by the lower-paid workers, the plant manager says. At General Motors, the savings from its two-tier workers are crucial to production that began last month of an inexpensive, subcompact car, the Chevrolet Sonic, in suburban Detroit.

Two-tier wage systems have been tried in the airline industry and others with spotty success. Usually the lower wages disappear rather quickly when the economy picks up. But the arrival of vastly different wage rates in auto factories is a seminal event in an industry long influenced by a powerful union devoted to equal pay regardless of seniority.

The new jobs, which are seen as long term, are being watched closely by economists, executives in other industries and Washington policy makers eager to increase employment in manufacturing and other areas.

“This is not going away,” said Kristin Dziczek, a labor analyst at the Center for Automotive Research in Ann Arbor, Mich., a research organization. “It has allowed the Big Three to reduce labor costs without cutting the pay of incumbent workers. Is it good for the health and competitiveness of the companies? Yes. And is that good for job security? Yes.”

Four years ago, the United Automobile Workers agreed to allow Chrysler, G.M. and Ford to pay lower wages to new hires to help close the cost gap with foreign carmakers. Now the two-tier arrangement is at the forefront of labor talks between the U.A.W. and the Detroit companies.

The union’s president, Bob King, has made an increase in entry-level wages a top priority in negotiations for a new national contract to replace the current agreement, which expires on Wednesday.

So far, about 12 percent of Chrysler’s 23,000 union workers earn the lower wage, and over all, 4,000 or so of the 112,000 U.A.W. members are second-tier hires. Those numbers are expected to grow — and in fact can increase significantly even under the current contract. The jobs are central to the contract talks now because they are viewed as a critical element of the industry’s continued recovery.

The benefits for the lower-tier workers are scaled back as well. They get a maximum of four weeks paid time off a year, versus five for the longtime workers. And instead of the guaranteed $3,100-a-month pension a full-paid worker receives after age 60, the new hires have to build their own “personal retirement plan” based on contributions from the company of less than $2,000 a year.

The gap in wages between regular and entry-level workers has created some dissent in the U.A.W.’s ranks. Some long-term employees have demonstrated against the two-tier system and called for it to be abolished. Mr. King, however, has focused on getting meaningful pay raises for the lower tier rather than eliminating it.

At the big Labor Day parade in Detroit, union activists chanted “equal pay for equal work,” and some full-paid workers said they were willing to forgo a wage increase in the new contract to help the lower-tier employees.

“In order to get those guys up, we’ll take a signing bonus or profit-sharing instead,” said Gary Wurtz, a line worker at G.M.’s plant in Orion Township, Mich., where 40 percent of the employees are lower tier.

There were some early problems with turnover among new hires who could not keep up with the intense pace of assembly-line work, according to Pat Walsh, the manager at Chrysler’s plant here. But the workers who stayed have performed well. “Our quality numbers have been very good,” Mr. Walsh said. “And our data doesn’t show any differences per shift or per workstation.”

Workers at Jefferson North said that the pay gap had not created visible tension. Rather, they say the older workers have encouraged the new hires to hang tough in hopes of achieving full-wage status down the road.

“They’re just telling us to hold out and that everything is going to get better,” said Mr. Chatman, the tire room worker.

Mr. Chatman, who is 44 and single, said the security of the job, which includes the union’s traditional medical benefits, is paramount to him. But he does not hide the fact that he expects one day to make as much money as his top-wage counterparts.

“I think they should get rid of the two tiers,” he said. “I hope it’s not here to stay. I hope it was just a steppingstone to get things back going again at Chrysler.”

There is no hard timetable for the lower-paid workers to move up to full-wage status, but it could take years. As part of the government’s bailout of G.M. and Chrysler, the union agreed that no second-tier worker can move up until 2015 at the earliest. At Ford, which did not receive federal aid, the current U.A.W. contract allows the company to fill 20 percent of its union jobs with lower-paid workers before it moves any into the top tier.

Experts on two-tier arrangements say that advancement opportunities are critical to the system’s success.

“If you know you’re going to get to the top wage eventually, the system can work,” said Peter Cappelli, a professor at the Wharton School at the University of Pennsylvania. “The big problem is when you think you’ll never get there.”

For now, employees like Mr. Chatman are exhilarated by their steady paychecks and the emotional reward of being part of Chrysler’s turnaround. He was recently promoted to be a team leader in the plant, which involves facilitating the efforts of 10 other employees, including two full-wage workers (no additional pay).

He can’t help smiling every time he sees each shiny new Grand Cherokee, one of Chrysler’s top-selling models, roll off the line. Still, it’s tough to accept that his entire annual salary of about $30,000 is not enough to afford the least expensive Jeep made at Jefferson North.

“It would be a shame to work at Chrysler,” he said, “and not be able to drive a Chrysler.”

Nick Bunkley contributed reporting.

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To: Glenn Petersen who wrote (395)9/20/2011 8:15:17 PM
From: stockman_scott
   of 431
Detroit's big crash and bigger resurrection

September 19, 2011: 1:35 PM ET

FORTUNE -- It's easy to think Detroit's automakers -- at least General Motors and Chrysler -- were just too inept to avoid bankruptcy. They couldn't screw together a popular small car if their jobs relied on it, and they came up lame fighting skyrocketing costs like health care. But author Bill Vlasic shows us Detroit's Big Three weren't nearly as dumb as Americans made them out to be. Early in his insider tale of Detroit's crash and eventual resurrection, Once Upon a Car, Vlasic details how almost everyone in the Motor City knew they needed to change before a crisis pushed them to the brink. But executives at GM, Chrysler -- and to a lesser extent Ford -- were too hamstrung by decades of bureaucracy and mismanagement. Only Ford, it turned out, could reverse course fast enough to avoid bankruptcy before the economy sank. Vlasic, a veteran auto reporter and Detroit bureau chief for The New York Times, tells a riveting story. He takes us into deep into GM's board meetings in 2006 when directors ignore ominous trends in favor of incremental course. He introduces characters like Jim Farley (cousin of the late comedian Chris Farley) who reviled Detroit's carmakers while working at Toyota ( TM) but eventually decided that helping Ford was part of his duty to his late grandfather, who went to work for Ford in 1914, and his twin infants who died after premature births.

Even with all the ink spilled on Detroit lately, Vlasic's tale is as fresh as a new car. Details from inside GM ( GM) board meetings might be the most enraging to taxpayers who ultimately bailed out the auto giant. As chairman and CEO, Rick Wagoner wielded outsized control over the board, and his political maneuvering squashed a potential partnership with Renault-Nissan, one that may have saved GM from filing the largest bankruptcy in U.S. history.

In fact, you walk away from the book wondering if a simple management shakeup -- separating the titles of chairman and CEO -- would have created a board strong enough to save GM. It seemed to work at Ford ( F). In 2005, Bill Ford, great-grandson of founder Henry Ford, understood he couldn't turn around his family's company alone. He recruited Alan Mulally as CEO, relinquished that title, and remained as chairman. Vlasic's reporting makes it clear that two heads at Ford were better than one at GM.

Chrysler isn't forgotten. We learn that the Germans at Daimler were itching to dump their American arm for months before saying so publicly. In the end, Vlasic shows, Chrysler didn't have a chance to avoid bankruptcy. Daimler had starved it of R&D in the merger's waning years. Even the Wall Street hotshots at Cerberus, who bought Chrysler in 2007, were surprised at how hollow the automaker was.

Vlasic says he wanted to write a fast-paced narrative, and he's penned a page-turner in Once Upon a Car. You dart from inside GM's tense boardroom meetings to the turnaround at Ford's Glass House headquarters, to the halls of Congress, where Wagoner, enduring lawmakers' hostile bailout questions, is waiting to sprint to the restroom after drinking too much coffee.

The book doesn't forget the hundreds of thousands of workers whose livelihoods were at stake. Vlasic interviews middle-class autoworkers across the country who consider themselves the last of a breed. Union head Ron Gettelfinger isn't free of blame. He overplays his hand with Chrysler during key health plan discussions and defends the union's infamous jobs bank.

Fortune makes an appearance when Carol Loomis's 2006 article predicting GM bankruptcy disappoints the company. Executive Bob Lutz is incredulous at outsiders for not understanding GM's turnaround plan. We "told her why we're not going bankrupt," he says of the Fortune senior-editor-at-large. "And she goes and writes that story anyway."

That anecdote says a lot about Detroit: The automakers saw trouble ahead, but two of the three couldn't shift fast enough to avoid it.

Fortune spoke with Vlasic before the book's publication to hear about the reporting and his thoughts on the future of Detroit.

Q. A lot of books have come out about the automakers. What were you tying to do differently?

A. I wanted to do a narrative. I wanted a turn-the-page, you-are-there book -- one where you get to know what really happened and how these executives behaved under such incredible pressure. Hopefully people understand how dire this situation became and how close this industry was to going out of business.

What was most surprising thing you learned?

I didn't know how dysfunctional General Motors really was at the top -- and Ford for that matter, too. I think the perspectives on GM and some of the players will change after they read this. I don't know if anybody comes off looking more positive than they would otherwise.

At the end of the book Jim Farley, the Ford executive, says "Fuck GM. I hate them." Is competition back in Detroit?

It's very interesting to watch them when they are making money. That quote by Farley got a lot of attention. But he's by no means the only one to express that sentiment within Ford. There's something about the GM arrogance and fact that they were not only bailed out by the U.S. government, but they were funded like no car company in Detroit has ever been funded. They had $30 billion in [bailout money] in the bank.

One of the larger things that happened was the Big Three broke apart forever. The day that Ford decided not to go back to Congress and ask for money, Ford went down one path, and GM and Chrysler went down another. That's healthy for the industry. A lot of the negotiating they used to do together brought them all down.

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