1st Gear: According to Bloomberg, Ford Credit plans to sell bonds with maturities as long as 30 years directly to individual investors. Ford, which avoided the bailouts and bankruptcies that befell the predecessors of General Motors and Chrysler in 2009, may raise as much as $5 billion through the offerings, according to a regulatory filing. The notes will be sold in $1,000 denominations with maturities starting at nine months, according to the statement. Some of the debt may have a "survivor's option," meaning that Ford Credit will buy back the securities from heirs when investors die. So, it's like a public bailout, only powered by capitalism. We like the idea — especially as Ford needs the dues.
2nd Gear: Alex Jefferson tells Automotive News dealers have themselves to blame for Internet leads flattening out in the past year, despite widespread online car shopping. Dealers' slow responses to Internet leads have trained consumers to contact stores by telephone or just walk in when their online research is complete, says Jefferson, director of Internet and training for the Proctor Dealerships of Tallahassee, Fla. And then, when these highly-educated consumers come in, they're screwed just like any other potential customer. Only now the screwing begins on eBay.
3rd Gear: According to Kelley Blue Book, the 2011 Chevrolet Volt will be worth just over $17,000 after 36 months, the length of a typical lease. That would be 42% of the car's $41,000 sticker price. Eric Ibara, director of residual value consulting at Kelley, says the residual value projection may seem low. But the first 200,000 Volts sold will qualify for a $7,500 federal tax credit, so that effectively drops the sticker on GM's "Jesus Car" to $33,500. Using that number, KBB's projection means the Volt will keep 51% of its value, better than some rivals. For example, the 2011 Toyota Prius, the industry's best known hybrid, has a projected residual of 46% after 36 months, Kelley says. The 2011 Ford Focus' residual is projected at 37.5%.
4th Gear: Bloomberg reports this morning that Ford's Freestyle — the crossover marketed to magnanimous divorcees — are being investigated by the U.S. auto-safety regulator after 238 complaints about unintended "lunging" at low speeds when the driver's foot isn't on the gas pedal. The National Highway Traffic Safety Administration is investigating about 170,000 Freestyles, model years 2005 through 2007, after 18 crashes attributed to the defect, including one that resulted in a minor injury, the agency said yesterday in a posting on its website. The "lunging," of course, could lead to... your fiery death.
5th Gear: Volkswagen AG plans to sell as much as 1.5 billion yuan ($231 million) of five-year bonds in Hong Kong as soon as today, becoming the first foreign car company to issue so-called Dim Sum bonds. How do we sign up for the "Moo Shu Pork" GTI?
6th Gear: The Saab story continues. According to Bloomberg, Spyker Cars NV, the Dutch supercar maker that owns cash-strapped Saab Automobile, said China's Pangda Automobile Trade Co. agreed to invest in the company, four days after a deal with Hawtai Motor Group collapsed. Pangda will take a 24% stake in Spyker for 65 million euros ($92 million) at 4.19 euros a share, the Zeewolde-based manufacturer said today in a statement. Pangda will pay 30 million euros to buy Saab vehicles and may make an extra conditional 15-million euro payment for more autos within 30 days. The companies said they plan a carmaking venture in China.
⏎ I can't imagine why Ford would be having problems moving Mercury owners toward Lincoln. Especially considering the cars are, you know, the exact same... except $5,000 to $10,000 more expensive. [Automotive News (sub. req.)]
⏎ Note to travelers on Cathay Pacific — when you smell smoke, there's usually fire... in your plane engine. [New York Times]
⏎ Tumi and Ducati are working on her royal highness' matched luggage. [The Rich Times]
⏎ No, this is not why we're fat. [Fast Company]
⏎ "Sex on Wheels"? Now it's "Room for groceries," too. [New York Times]
⏎ The Zagato-penned Perana Z-One heads for production. [Pistonheads]
On this day in 1956, executives from the Detroit-based automotive giant General Motors (GM) dedicate the new GM Technical Center in Warren, Michigan. Costing around $100 million—or about half a billion in today's dollars—to develop and staffed by around 4,000 scientists, engineers, designers and other personnel, the GM Technical Center was one of the largest industrial research centers in the world. [History]
Photo Credit: egmCarTech
Got tips for our editors? Want to anonymously dish some dirt on a competitor? Know something about a secret car? Email us at email@example.com.