Volume II, Issue 5, Page 4

Burk's Bowtie Blast!

Detroit’s reality is different from yours and mine

My newspaper this morning had a headline that read, “DaimlerChrysler sells Chrysler!” As a car guy I was naturally intrigued by that so I began reading the story. Almost immediately I realized that once again what is reality for you and me has no relationship with the reality of big business, especially the big car business such as Chrysler, Ford and of course the mothership company for Chevy, General Motors.

As I read the news story about the supposed sale of the once proud and highly successful automaker that the iconic Lee Iacocca once took from a money losing proposition to one that that the German automaker giant Mercedes-Benz thought was worth paying $36 billion for in 1998, I was shocked to see that DaimlerChrysler was PAYING a company to take the Detroit business off of their hands. I checked my morning coffee to make sure I hadn’t mistakenly spooned part of my pharmaceutical stash into it thinking it was sugar and as a result was hallucinating massively. I rubbed my eyes and read the story again and realized that I had read it correctly. The Germany-based company had in effect paid someone to take a billion dollar car company off of their hands. It was then I realized that reality is no longer so easily definable, especially if you are talking about the corporate world of “bidness.”

So what the hell does this have to do with the world of Chevrolet? Well, what it means to those of us at or near to the lower part of the economic food chain is that despite the headlines that we see about Toyota passing up GM in sales and the tremendous amount of money GM is supposedly losing, I don’t think we should be worrying about whether we’ll be able to buy that new generation Camaro or for that matter any of the Chevy models you might covet.

Not too long ago I noticed that despite my concern about the health of the GM Company the people I know in the racing end of GM assured me that there was nothing to worry about. I kept reading about the company’s mounting loss of sales, subsequent loss of revenue and the closing of plants, but regardless of that seemingly bad news none of the people I know seemed worried.
           
With that in my mind, I took my first trip to Detroit to visit with some GM folks and see several of their plants. I was mightily impress by everything I saw from their headquarters in the Renaissance Center, a gleaming edifice to GM in downtown Detroit, to their buildings that house their technical and Research and Development centers.  I had expected to meet a harried bunch of GM folks worried about the state of the company and their jobs. What I saw was quite the opposite.

The PR and engineering types MaxChevy’s Ro McGonegal and I met seemed unconcerned about the future of GM. Instead, they talked about future engineering projects and cars. GM was even building a massive new structure adjoining the GM Powertrain building we visited so that they could bring the entire GM Engineering family under one roof so to speak.

So here’s the deal my fellow Chevy lovers: Chevy and, indeed GM, isn’t in any kind of danger, in my opinion. They continue to support racing and high performance at all levels from eight-figure investments in NASCAR teams to NHRA Funny Car and Pro Stock programs, to all sorts of open wheel racing. They’re busy working on the new Camaro and ‘Vette and offering performance packages for almost every car they make.

The DaimlerChrysler deal proved one thing to me: The financial community that supports companies like GM, Ford and Chrysler simply are not going to allow those companies to fail and close their doors. When you have a company such as GM that produces revenues in the hundreds of billions of dollars annually, a half-billion dollar loss in a quarter isn’t even a blip on the radar screen. That doesn’t mean the upper management at GM and other car companies won’t use the losses to close plants, cut jobs and consolidate their holdings. That’s what management is supposed to do regardless of whether they are managing NASCAR, the NHRA or GM. They are paid to increase the business’s bottom line. So, the reality of big businesses like GM and even the Chevrolet division of GM has little to do with the reality of you and me. We deal with a different kind of reality where buying a $45,000 ‘Vette or building a $15,000 race motor is a very big deal.

So, rest easy my fellow Chevy lovers. For the foreseeable future we are going to continue to see the Bowtie on fast cars and parts, and from where I sit we are going to see more and better cars and products. But I’ve decided that I’m going to quit worrying about the company no matter how much money they lose on paper ‘cause now I know that if worse comes to worst, the local Detroit payday loan company will come to their rescue just like they did for Chrysler.

Now I’m just gong to take another hit off my suspect cup of coffee and imagine myself in a new Camaro convert tooling down A1A in Daytona Beach on my way to the Ocean Deck Bar for a plate of “steamers” and a cold beer. Of course, the chances of that happening are about the same as one of the Big Three car owners paying someone billions of dollars to take the company off their hands.  

 








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