THE LATEST ANSWERS TO THE QUESTIONS NOBODY’S ASKING.

Editor's Note: This week, Peter brings up one of our favorite topics - the Answers to the Questions Nobody's Asking. Just in case you were wondering, they don't call him The Autoextremist for nothin', folks. We also get a good look at BMW's Neue Klasse Concept in On The Table, which has the German automaker questioning everything and embarking on a destination to The Future. I'm not really digging it all that much, the "circularity" giving me pause. And, not to be outdone, Mercedes has unveiled its Tesla Model 3 fighter, the all-electric Concept CLA Class, calling it the "electric future of desire." Really? That's quite the stretch. And we left the Alfa Romeo 33 Stradale up so you could have another look. Our AE Song of the Week is "Daylight" by Maroon 5. In Fumes, Peter delivers Part VI of his riveting series, "The Glory Days." And finally, in The Line we have results and video highlights from INDYCAR in Portland, with 26-year-old Alex Palou winning his second championship in three years, plus F1 from Monza and MotoGP from the Circuit de Barcelona-Catalunya. Onward. -WG

By Peter M. DeLorenzo  

Detroit. If this business wasn’t a Rolling Shit Show at times, I wouldn’t recognize it. But the ugly reality is that it’s a churning, burning, swirling maelstrom of brilliant, visionary moves punctuated by relentless acts of abject stupidity.  

This business can’t help itself, because the executives in charge can’t help themselves, apparently. One or two positive press clippings, and delusional thinking kicks in like an atomic alarm clock going off. It’s a particular disease among executives in the auto business and there’s no known cure. It results in a grueling, two steps forward and five back Dance of Mediocrity. 

The latest evidence that this sickness is alive and well? We only have to look as far as Mercedes-Benz, the hands-down Kings of Delusional Thinking. In fact, they retired the trophy years ago. (The Trophy? It’s a snow globe, but instead of snow it features black rain that, if you shake it just right, turns into silvery disco glitter that reminds those in possession of it that all of their decisions are indeed brilliant.) This company’s execs – including its “thank you, sir, may I have another” stumblebum board of directors – have done less with more than any other car company in the world. 

They have a scintillating historical legacy that other car companies would kill for, yet they squander that legacy at almost every turn. They seem to operate in a hermetically sealed bubble where all of their decisions are not only brilliant, but they spend half their days admiring their brilliance in the mirror, while wondering why mere mortal companies just don’t get it. Maybe they keep telling themselves that their F1 team is just going through a bad patch too? 

At any rate, back to the latest evidence. In an interview with CNBC last week, Ola Kellenius, the Mercedes-Benz CEO, said that the company would be building a “little G Class” in the coming years. You know the G Class, of course, the favorite of music performers and Hollywood-types, not to mention upscale women drivers in tony suburban enclaves across the country. The G Class, which underwent a substantial and hugely successful upgrade several years ago, has established such a reputation for itself that even its $150,000 (or thereabouts) sticker price is not a deterrent. It is one of those “when I get the money I gotta have one” vehicles that exudes the kind of brand image that other manufacturers would kill for. 

But here comes ol’ Ola with this gem of a statement to CNBC: “So kind of the daughter or son of the big G is also going to come to G fans around the world in a few years from now… If you’re waiting for something good it will be worth the wait.” 

What part of this situation does this guy not get? An absolute star on the road with demand that far exceeds the supply, a platinum-grade profit center that prints money, and a cool factor that has proved to be impenetrable by Cadillac, Range Rover, Bentley et al. in spite of those companies’ best efforts. But wait, as if Kellenius didn’t already emit enough wrong-headed thought balloons, he closed the interview with this missive: “The G Class is an icon, it is difficult to get one. If you do get one you feel like it’s almost like your birthday and we will be very, very careful managing volume with the G Class.” 

So, let me get this straight: He’s going to carefully manage volume by cranking out an imitation “junior” G Class model that will only serve to water down the G Class brand image? I know unmitigated bullshit when I smell it. A “junior” G Class is the latest Answer to the Question that Absolutely Nobody’s Asking, and it will only serve to destroy the aura of the real G Class. (You can see another “big idea” from Mercedes-Benz in “On The Table” – WG)    

The company has unveiled a new advertising theme too: “Defining Class since 1886.” My take on Mercedes-Benz at this juncture? It has been “Defining Delusional Thinking for as long as I can remember.” Nicely done, ladies and gentlemen, you just can’t help yourselves, can you? (Also - isn't saying you are 'defining class' just about the least classy thing you can do??? Read more in On The Table. -WG)

Speaking of delusional thinking, we have the specter of Shawn Fain, the new leader of the UAW, conducting a scorched-earth offensive against the Detroit-based automakers that has put this business into a tailspin of dread. This guy hasn’t just been doing some time-honored UAW saber-rattling, he’s wielding an RPG and threatening to blow up the whole damn thing. 

"Our goal is to bargain a fair contract, but if we have to strike to win economic and social justice, then we will," Fain said on a livestream via Facebook this week, as reported by Automotive News. "I know our demands are ambitious, but I've told the companies repeatedly, I'm not the reason that member expectations are so high. You can't make a quarter trillion dollars in North America profits over the last decade and expect us to keep aiming low and settling lower." 

What is he demanding? A 40 percent raise for UAW members: 20 percent now and 5 percent in each of the next four years. And he has wrapped his demands in such vitriol that he has made everyone sick of him in a matter of months in this town. That’s not all. He is threatening to strike all three companies – Ford, GM and Stellantis at once – if there is no deal by September 14^th, which is the deadline. (This just in: No one is expecting a deal by then.) That this would happen in the midst of what’s left of the Detroit Auto Show is just icing on a very bitter Shawn Fain-autographed cake.  

The problem with all of this is that a strike against the Remaining Three at this point would cripple these companies almost permanently. They can’t get their new BEV technology to market fast enough, and the massive investment needed to get the whole EV thing rolling is so crushingly expensive that they’re teetering on the edge. These three companies are already behind Tesla, and now the Korean automakers are unleashing ultra-competitive – and attractive – BEV offerings at a dizzying pace, not to mention the rest of the manufacturers angling for a piece of the BEV pie. Which leaves the Detroit-based automakers, despite the gigantic profits of late, hanging by a collective thread. 

Will cooler heads prevail? As long as Fain is allowed to spew his hatred toward the auto companies unimpeded, I seriously doubt it. This is going nowhere good in a hurry.   

Which brings me to the other Answer to the Question that Nobody’s Asking this week: A crippling strike. It would be the absolute epitome of short-sightedness, and it would slam the Remaining Three with such a crushing deficit on the competitive front that it might just hasten their demise.  

On that note, have an excellent day! 

And that’s the High-Octane Truth for this week. 

Editor's Note: You can access previous issues of AE by clicking on "Next 1 Entries" below. - WG