So the sad fact has finally reared it’s ugly head. GM, the largest and most diverse company to file Chapter 11 bankruptcy protection, is looking for the best path through the mess they’ve been mired in. While Chapter 11 gives them the ability to operate, the company that will emerge will be vastly different than the one that we know today. With talks of “Government Motors,” fire and brimstone, and a unsure future, GM is itching to see what lies on the other side of the long drawn out court battles.
They might get an answer to their questions a lot sooner than expected though. While everyone thinks they’ll file in Michigan, they’ve found a nice little loophole in the law that allows them to file somewhere else. By exploiting an option they plan to file in the land of quicker Chapter 11 solutions, a land where Enron, WorldCom, and General Growth Properties filed. To fully understand how they are able to file somewhere else in Michigan, one has to learn about a little dealership in Harlem, NY.
Chevrolet-Saturn of Harlem opened up back in 2006, and was supposed to help import money and jobs into a stagnant part of Harlem that had not hosted a car dealership in over 40 years. Rick Wagoner, Mayor Bloomberg, Representative Charles Rangel, and the Reverend Jesse Jackson we’re all there on opening day to praise open the dealership. The mostly minority owned business took a successful business model, but their high expectations in the face of their location caused the dealership to under perform. GM, wanting to help out the little guy, took control of the business, and it is one of very few dealerships that is GM owned and controlled. GM had been actively looking for another owner for it, but then a juicy opportunity came up.
Oddly enough, Chevrolet-Saturn of Harlem filed for Chapter 11 before GM did. Turns out they had a debt issue as well, and are looking for a way out. Best part of all though, since they are a GM owned dealership, this allows GM to claim they are incorporated in New York, and file Chapter 11 in Manhattan courts.
Clever GM lawyers knew that the court system in New York has handled large cases in the past, thus are better equipped to deal with the demands of all the court time this will take. Filing in New York can get GM restructured sooner, and make arrangements with their debt holders quicker, hopefully producing the leaner meaner GM we are all looking forward to. Being able to file in a state familiar with large Chapter 11 filings seems to be the smartest thing GM has done in years.
What about the scape-goat? Chevrolet-Saturn of Harlem appears to be conducting business as usual, as Chapter 11 allows them to operate as usual through the process. Who knows, maybe iconic GM will rise up to be the world beater they once were, and we’ll have a small, neglected dealership to thank for speeding their success along.
-KF
Saturn SL/SC – An upstart company, in the mid-80′s, had a vision of affordable cars with customer service that rivaled luxury brands. GM incubated this new startup carmaker, and when they couldn’t sustain itself, GM took over the operation. By creating cheap (if not mediocre) cars with no haggle pricing and great customer service, Saturn hit a home run. While the brand is dead today, there is no debate that these inexpensive cars with their plastic dent resistant panels represented a huge leap forward from GM. It’s not uncommon for these little guys to run abused past the 200k mile mark, and keep on chugging, proving that America can do cheap and reliable, just like their rivals from across the Pacific.
Lexus LS 400 – Toyota took a cue from Honda, who created the Acura brand to market its upper class vehicles. The formula was simple: take what the Germans do best, and shove it back in their smug faces. Who thought a brand known for making fun little tin cans could whip up a hyper luxury car that could offer more than an S-Class or 7 Series? They did that and more, all while undercutting their price point. Known for stone cold reliability (something that began to elude the Germans in the 90′s), it’s common to see neglected LS 400′s still running around, hundreds of thousands of miles behind their bald tires. It’s a fair bet to make that there is still some money left in their owners’ wallets.
Porsche Boxster – The Boxster was the car that Porsche has been wanting to create for 30 years. It’s no secret that Porsche’s been trying to replace the fabled 911 for about 30+ years, with cars like 924, 928, and 944. They wanted to remain loyal to their purists, but needed to branch out and diversify their lineup. Offering awesome handling, precision steering, adequate power, and a open-top motoring experience, the Boxster was a hit. It was actually such an immense hit that Porsche actually decided to make all their cars resemble the looks of the Boxster (see the 996 and Cayenne). Without the Boxster, Porsche as we know would not exist today. The Boxster took a car company that was getting stale and perceived as a one-horse wonder, and made them relevant again.
Ford Explorer – While some kids might have been attacked by a T-Rex in one, this was the favorite kid hauler of the 1990′s. Too old to want a wagon, too hip to drive a mini van, Americans turned to the SUV. With promises about adventures off roading and camping, Ford sold more Explorers than expected. Sadly though, most of these lived only on paved roads, with the occasional dirt parking lot at a Spice Girls concert. In the 1990′s, if you were the hip Dad rocking out to Candlebox on the way to preschool, chances are you were driving an Explorer XLT or Eddie Bauer. Don’t let the Firestone debacle scare you (*cough cough bad drivers*), these were excellent trucks.
GM (Saturn) EV1 – The second Saturn vehicle on this list; strange ain’t it? The all-electric EV1 could be the car that started the downfall of GM. The Saturn EV1 showcased the American ingenuity and forward thinking. GM correctly marketed this vehicle as a Saturn, because in 1996, the Saturn brand was a ‘forward thinking’ company. Since the EV1 only could be leased, and not purchased, the demand was artificially deflated. The cancellation of the EV1 program is also highly controversial. The conspiracy theorists state that the GM brass decided they couldn’t profit from servicing these vehicles (no oil changes or tune-ups), basing their information from typical dealership service department hearsay. The arrogance and the greed of GM and its dealers killed the EV1. Soon after the death of EV1, the Prius took over as the halo ‘green car’ while GM was rolling in cash from selling SUVs and trucks.
Chevrolet Corvette (C5) – GM might have shot the interior out of a plastic shotgun full of various borrowed parts, but under all of the plastic, cheap leather and balsa wood is where this Corvette trounced all others behind it. With an obtainable entry price, unending power and torque from the LS1, and a T-56 transaxle to route the power, the C5 had the go fast bits ready. What really set this apart though, was the hydroformed chassis, which was an elegant solution to the complex frame design. No longer did the interior make noise like crickets finding each other in a hurricane, and no longer did your chassis flex your contact patch away mid corner. Predictable and high limit handling, with plenty of acceleration, you had to spend a lot more money back in the 1990′s to beat the C5′s performance in any regard.
VW New Beetle – The public as a whole buys cars on looks (well, Ramblers did sell…), and there is no smarter way to pack your showrooms than remake a car everyone loved. Since almost everyone has a fond story of a Beetle, it only made sense to fill showrooms with people who want to have another cute mobile. Whether or not the 2.slow engine was a boat anchor, or the interior had an aircraft carrier sized dashboard, this car simply made people smile, and remember their beloved cars of the past. Did you hear the last part Ford and Chrysler? That’s right, the formula is proven, people like retro cars, so feel free to make all the PT Cruisers and Mustang GT’s you want, with some retro Camaros and Challengers in there for good measure.
VW Jetta/Golf - These cars allowed journalists the ability to combine the term dash stroker and frugal in the same sentence. For years, fully grown men realize they have made it in life when the pure act of sitting inside their Lexus, BMW, Audi or Mercedes is just as fun as driving it. The quality of materials, the softness of the materials, the seamless stitching, and the plush headliners all add up to a tactile overload that shows the world you cashed in your Corolla, and now you commute with style! Well, along came the MkIV, and it threw a wrench the size and shape of a big yellow couch into the works. All of a sudden every kid with a cosigner could lease one, and extol the virtues of soft touch plastics to their lesser brethren just like their dear old dad can with his Bimmer. What this did for everyone else is set the standard high for what is expected out of a commuter, and dash strokers around the world rejoiced, as it’s pretty hard now to find a commuter car without a nice interior. Suddenly the economy car wasn’t the penalty box it used to be.
Nissan 300ZX Turbo (Z32) – Before the 1990 300ZX Turbo, Japanese sports cars were considered second class citizens. This Z car though, was low slung, wide, powerful, featured timeless design, and made a huge statement. It not only revitalized the Z fan-base, but it attracted a whole new clientele. Even people who didn’t necessarily like Japanese cars were inclined to give the Nissan at least a look or two. The Z had a twin turbo engine and a 4-wheel steering system, the two features that the Japanese rivals copied – the 3000GT, Supra Turbo, RX-7. Even GM felt the kick in the ass to make the next Corvette (C5) better, and the ‘Super GT’ class was born.
BMW 540i (E39) – While we wanted to cheat and put the M5 in here, and against the fact that it was delivered in the states in late 1999, the M5 truly is a 2000 model year. What spawned this monster of a car, with 400hp, a manual transmission, and an interior even a MkIV owner would drool on? It’s little brother, the 540i. The horsepower war in the family sedan segment had seemed to have stalled out in the late 1990′s, as BMW and Mercedes waited for one another to show their hand for their next ‘Bahn Stormer. In the mean time, nothing defined the perfect daily driver like a high HP, RWD, manual transmission BMW. Back when the looks were elegant and understated, when the interiors were not blistered with i-Drive humps, you could get a 155mph family hauler that was just at home in your daily commute as it was pounding your favorite back roads. Executives all over the world love their toys, and leasing a 540 in the 1990′s while your M5 was on order was the smartest way to keep your wife happy with a family hauler, while having all the fun you wanted on the side.
Hyundai Tiburon – Even after the introduction of the Tiburon in 1996, the general public thought of Hyundai as a cheap, junky cars. The boys in Seoul decided to make a stronger presence in the world. The only way to get any respect was to up its quality. Good thing, since the Mitsubishi owned Hyundai was finally able to stand on its own. The Tiburon replaced the Scoupe (which had a good track record of racing), and slowly reversed its shoddy image. They soon introduced the 10-year warranty, the third generation Sonata, and even Consumer Reports reliability ranking caught up to Honda’s level. The Tiburon was Hyundai’s halo car before the Genesis, and it signified the start of Hyundai’s 10+ year meteoric rise.
Nissan Maxima (A32) - The car itself wasn’t spectacular in any sense. It could be argued that this generation of Maxima almost made Nissan bankrupt. But this car is on the list for one thing, this stale-looking Japanese mid-size car can hit 0-60 in 6.5 seconds, all thanks to its engine. The mighty VQ30DE engine might be the most important engine in the last two decades. This V6 engine was developed for the German Touring Car Championship racing circuit, and was dropped into the American market Maxima. The race engine was super smooth, powerful, and extraordinarily light. Until the VQ30DE, the general thought was that the inline-6 engines were the way to go for smoothness and power (BMW and Toyota). Not only this engine made the list of many automotive publications’ top engine list, but found its way to just about every Nissan/Infiniti vehicle on the market today. It’s taken nearly two decades for the other manufacturers to catch up to the VQ.
AMG Hummer – Ever thought what it would be like to build a suspension from bridge girders, fire Stinger missiles from your roof, or lead an attack through the desert, all while getting 8mpg? If this was your fantasy back in the 90′s, this was the truck of choice. With the ability to maul unpaved roads like a Cougar at ladies night, nothing short of narrow trails stopped the H1. Loved by our favorite Terminator, hated now by anyone who hugs baby seals and loves mother earth, the H1 was a way to make a statement that you were a pure, unadulterated, bad ass. While it wasn’t quite 12 yards long, or two lanes wide, it was close to 65 tons of American Pride.