ON THE TABLE - SEPTEMBER 18, 2013
Tuesday, September 17, 2013 at 12:03PM
(Alfa Romeo images)
In releasing details on its new 4C, Alfa Romeo says that the machine was "designed, engineered and built as a pure driving machine... an uncompromised thoroughbred that marks the return to the world of lightweight sports coupés for the Alfa Romeo brand... making it a worthy descendent of one of the most beautiful coupés of all time: the Alfa Romeo 33 Stradale." Editor-in-Chief's Note: That's a load of PR crap. The 4C designers did a nice front end and then took the rest of the afternoon off. The rest of the car is an afterthought. But at any rate, the 4C has a dry weight of 895kg and a 40:60 front-to-rear weight distribution, so there's that. - PMD
The mid-engined Alfa Romeo 4C is powered by a turbocharged, direct-injected, 1750 cc TurboPetrol engine delivering 240hp at 6,000 rpm with maximum torque of 350Nm (258 lb ft), which is available between 2,100 and 4,000 rpm. Eighty percent of its torque is available from just 1800 rpm. The Alfa 4C also utilizes the latest generation of the "Alfa TCT" dry twin clutch transmission.The 4C has a one-piece carbon-fiber monocoque and SMC (Sheet Moulding Compound) is used for the bodywork. The thickness of the glass has been slimmed down by 15% to help reduce the Alfa Romeo 4C’s overall weight.
Inside the Alfa Romeo 4C, the exposed carbon-fiber chassis is visible and a multi-function digital display occupies the instrument binnacle in place of traditional dials. The flat-bottomed steering wheel has integrated paddle-shifters. The remaining controls are grouped together on the tunnel console, including the button-operated TCT transmission selector and the DNA system selector, which alters the operational parameters of the engine, transmission, ESC and electronic Q2 differential depending on the driver’s requirements. Composite bucket seats and aluminum pedals complete the cabin.
The 4C has a double-wishbone front suspension bolted directly to the monocoque, while a McPherson arrangement can be found in the rear. The brakes are of a patented aluminium/cast iron hybrid construction complete with ventilated, cross-drilled 305mm/292mm discs (F/R) clamped by Brembo calipers. Seventeen-inch front and 18-inch rear wheels are standard, while 18/19-inch wheels with Alfa Romeo’s signature, five-hole “telephone dial” design are optional. Alfa Romeo claims that the 4C goes from 0 to 62mph in 4.5 seconds with a top speed of 160mph. It goes on sale in the UK in October priced from £45,000 on the road, with first deliveries expected early in 2014. In total, global production for the Alfa Romeo 4C is limited to just 3,500 units. Expect to see it in the U.S. sometime next year for a price somewhere around $70,000. Editor-in-Chief's Note: Yes, The Great Sergio insisted that we'd see the 4C here before the end of this year and that Alfa would be a force to be reckoned with in this market by 2014. That's notgonnahappen, as I predicted a long, long time ago. The 4C appears to be a nice little sports car but it will do exactly zero to establish Alfa Romeo as a brand here. It's a niche within a niche, just like the Alfa Romeo brand was before it went belly-up in this country the first time around. - PMD
(Photo by Joe Imel for Chevrolet)
Chevrolet began shipping the 2014 Chevrolet Corvette Stingray to dealers nationwide on Wednesday, September 18, 2013. The plant has produced approximately 1,000 Corvettes for customer deliveries. Most of these vehicles are expected to arrive at dealers within the next few weeks.
Editor-in-Chief's Note: Forget about the car business for a moment and watch this long-form video presented by Chipotle here. Worth it. - PMD
Editor-in-Chief's Note: Gary Vasilash of Automotive Design & Production sums up last week's episode of Autoline After Hours for us here. - PMD
Editor-in-Chief's Note: Watch Top Gear's tribute to the British motoring industry here. - PMD
Editor-in-Chief's Note: Tom Bartkiewicz, AE's economics correspondent, has been writing lengthy emails to us about the state of the economy almost from the beginning. We thought we'd share his latest missive with our readers because it's so pertinent to what's going on in the market right now. - PMD
September 18, 2013
As good as it's going to get.
By Tom Bartkiewicz
Baton Rouge. It has been almost five years to the day that a large systemically important financial institution known as Lehman Brothers declared bankruptcy. Although the foundation of sand on which much of our economic activity rested had been built over previous decades, the collapse of this institution precipitated a run on what is known as the shadow banking system and caused a financial crisis not seen since the Great Depression. In economics correlation is not causation. Just as the stock market crash of 1929 did not cause the Great Depression, the Great Recession of 2008 was not caused by a subprime housing crisis.
A “housing crisis” would still have been ugly, but it would not have produced a meteor-hitting-the-planet level of disruption to the markets. Look, sub prime was a $1.3 trillion market. Losses were roughly 40%. That crisis would have produced a really serious recession, but not a financial system near-death experience.
This was a “wildly interconnected and under-capitalized big financial firms got high on CDOs and other leveraged bets on housing and killed themselves and got turned into zombies” crisis. CDOs and credit default swaps allowed banks, monolines, and AIG to wind up with exposures way way in excess of the real economy value of sub prime lending. I sent a number of emails to Autoextremist prior to the Great Recession warning of a coming financial crisis and the impact it would have on the auto industry. The following one was composed on November 7, 2007 and subsequently posted to this site:
Announcement: GM writes off $39 billion dollars in deferred tax assets.
Translation: GM is not going to be making nearly as much money in the future as it thought it would and therefore will not be paying as much in taxes as it thought it would so therefore its accumulated tax dodges are not worth as much as previously thought.
Elaboration: GM’s manufacturing operations have lost more money in the past than they have owned up to and hiding those losses with profits from GMAC. Those profits are turning into losses in the ongoing financial industry meltdown. GM can no longer hide the losses from manufacturing and must make real money going forward by manufacturing vehicles they can sell at a profit, which they don’t think is going to happen.
Bottom Line: The worst is not behind GM but ahead of them.
General Motors filed for bankruptcy June 1, 2009.
Where are we five years on from the September 2008 meltdown?
Let's look at the auto industry from the supply side. The crisis has allowed the automakers to restructure and reorganize. They have eliminated many of their legacy costs, reduced their fixed costs by downsizing and in the process greatly lowered their break-even points meaning they can be profitable at lower volumes. At the same time they have significantly raised the prices of their vehicle. Transaction prices are at record highs. They're all singing that Depression era tune "We're in the money." They've got a lot of what it takes to get along.
Now let's look at the demand side. The consumer. The car or truck buyer. In an economic downturn sales tend to overshoot to the downside. Sales fall below rates necessary to replace the stock of vehicles. This tends to cause sales to overshoot on the upside during recovery. What about the quality and quantity of the population of buyers? In the five years since the crisis the U.S. has lost three million jobs. Over this same time the population has increased by thirteen million. This has resulted in the lowest labor force participation rate in over thirty years. In other words we have more people and fewer jobs. Then there's this: In 1989, the median American household made $51,681 in current dollars (the 2012 number ... was $51,017). That means that 24 years ago, a middle class American family was making more than the a middle class family was making one year ago. We've got less of what it takes to get along.
So we have fewer people employed in a population that's larger. Incomes that are stagnant for the majority of families and the automakers selling more vehicles at higher prices. How is this being accomplished? More leasing and longer loan terms. Surprise Surprise Surprise.
We are dealing with fundamentals that are not healthy. The economy has not recovered for 90 percent of the people. It has for the plutonomy Peter reported on from Pebble Beach. The economy is cruising near stall speed and absent Federal Reserve policy accommodation in the form of low interest rates and quantitative easing it would crash.
We've been through rough seas only to come out and enter the doldrums. I suspect sales are peaking or have peaked and we've seen as good as it's going to get.